The petition was signed by Alex M. Martinez, managing member ofthe Company.

ABUNDANT RENEWABLE: Helix Wants to Buy Assets; Files Reorg. Plan----------------------------------------------------------------Nathalie Weinstein at Daily Journal of Commerce reports that HelixWind submitted with the U.S. Bankruptcy Court in Oregon itsreorganization plan, which includes using $345,000 to pay off someof the debt incurred by Abundant Renewable Energy, LLC'sprincipals, to Oregon's bankruptcy court. DJC relates that HelixWind wants to acquire ARE. According to DJC, no hearing date wasset for the proposal. DJC quoted Greg Price, ARE's sales andmarketing manager, as saying, "Helix has to raise between$5 million and $6 million. There's always a chance it won't workout, but we have confidence they will be able to raise the money."DJC states that Helix Wind hired financial investment firmDominick & Dominick of New York to pursue financing options forthe purchase.

ACE CASH: S&P Downgrades Ratings on Senior Facility to 'B+'-----------------------------------------------------------Standard & Poor's Ratings Services said that it lowered its ratingon ACE Cash Express Inc.'s senior-secured credit facility to 'B+'from 'BB-' and revised its recovery rating to '3', indicatingS&P's expectation of a meaningful (50% to 70%) recovery in theevent of a payment default. At the same time, S&P affirmed its'B+' long-term counterparty credit rating and revised its outlookon ACE to negative from stable.

S&P used an enterprise value approach to analyze the lenders'recovery prospects, given the likelihood that the business wouldretain value as an operating entity in the event of a bankruptcy.

S&P believes that if ACE were to default, its business model wouldcontinue to retain value given its expansive geographic footprintand strong market positions in payday lending/check cashing. As aresult, S&P believes lenders would achieve the greatest recoveryvalue through reorganization rather than through liquidation.

The negative outlook is driven by potential legislative actions inArizona and Ohio related to short-term consumer loans that mayreduce ACE's earnings from those states. (At June 30, 2009, about6.1% and 2.7% of ACE's company-owned stores were located inArizona and Ohio, respectively.) The existing law authorizingpayday lending in Arizona expires on July 1, 2010. It is unclearif legislative efforts to renew the existing law will besuccessful. In Ohio, legislation was introduced in the House ofRepresentatives in June 2009 to close what legislators view asloopholes to the Short-Term Loan Act. S&P believes thislegislation has a reasonable chance of being passed in the nextsix months, which would render short-term consumer lendingunprofitable in Ohio.

The negative outlook is primarily based on the company's exposureto consumer lending in Arizona and Ohio. S&P could lower therating if adverse legislative actions in these states pressurecoverage metrics, which are currently weak for the rating. S&Pwill revise the outlook to stable if coverage levels aremaintained at adequate levels.

ALLIANT TECHSYSTEMS: Fitch Says Risks Remain in Sector------------------------------------------------------Credit quality in the U.S. commercial aerospace industry willremain under pressure in 2010, while the U.S. defense sector islikely to experience more stability, according to Fitch Ratings.Fitch expects deliveries in all commercial aerospace originalequipment segments to decline in 2010, but aftermarket salesshould begin to improve modestly. Defense spending will continueto grow in the low single digits.

Credit metrics for many A&D companies deteriorated in 2009, butthey are likely to be steady in 2010. Profits and cash flowscould be helped by improvement in the high-margin aftermarket, thefull-year impact of 2009 cost reductions, and defense growth, butthey will be held back by higher pension expense and weakcommercial OE markets. Fitch says liquidity remains strong afterimproving in 2009 because of lower share repurchases and someopportunistic debt issuance, but the company expects cashdeployment will increase during 2010, particularly foracquisitions and pension contributions.

Key risks for the sector include the weak global economicrecovery, exogenous shocks (terrorism, disease pandemic, etc.),large U.S. government deficits, and execution on new programs.The 787 program remains a continuing source of risk for Boeing andits suppliers. Flight hours and airline traffic have moved off ofcyclical lows, but they remain at depressed levels. A generalrisk is that some production rates have not been revised downwardmaterially despite the weak economy. Fitch does not expect thatfinancing availability will be a limit on aircraft deliveries in2010, although some concerns remain in the aircraft financebusiness. Longer-term, Fitch considers the commercial outlooksolid because of large backlogs and the need to build aerospaceinfrastructure in developing regions.

-- Large Commercial Aircraft: Fitch expects LCA deliveries from Boeing and Airbus will decline approximately 5% in 2010 to 920 aircraft, with revenues down 5%-10%. These estimates incorporate the announced production cuts for the A320 family (down two aircraft per month) and B777 (down almost 30%), but they exclude possible 787 deliveries (discussed below). Fitch believes there is a strong chance of additional production cuts, but these are more likely to take place in 2011. Long manufacturing lead times, advance payment requirements, and indications of sold-out 2010 production schedules support the argument against additional cuts next year, unless they are announced in the next few months to take effect at the end of 2010.

Fitch's forecasts will include additional 5%-15% cuts beginning in2011. Fitch forecasts the additional LCA production reductions in2011 because of a moderate global economic recovery, airlinecapacity reductions in 2008 and 2009, substantial airline losses,and deliveries that are exceeding typical aircraft retirements.However, the eventual production declines should be moderaterelative to prior LCA cycles as a result of large backlogs,production restraint since the last downturn, some remainingoverbooking in the delivery plans, and the geographic diversity ofthe customer base. In addition, the long-term nature of aircraftassets, as well as operating cost savings, provide incentive forcustomers to continue taking delivery of aircraft despitecyclically weak airline traffic. If the projected production cutsare managed with sufficient lead time, both the manufacturers andthe supply base should be able to adjust their cost structures intime to prevent deterioration of their credit profiles.

Fitch expects LCA orders to be low in 2010 and 2011, acontinuation of the trend in 2009, in which there have been only287 net orders through November compared to 867 deliveries duringthe same period. There were 142 cancellations through November,and Boeing has indicated that it had approximately 215 deferralsin the first three quarters. Low orders are not a credit concerngiven that Boeing and Airbus had a combined backlog of 6,849aircraft at the end of November, equal to more than seven years ofproduction at estimated 2010 rates. Excluding 787 and A350backlogs, the industry still has almost six years worth of orders.

Boeing's 787 program will continue to be a key concern for the LCAsector and its supply base in 2010. If Boeing meets its currentschedule, Fitch estimates the company could deliver 10-15 787s inlate 2010, but there is considerable risk to the schedule,including an aggressive flight testing program, certification, andthe production ramp-up. Boeing will be building 787s through theflight testing program, exposing the company to the risk ofreworking some aircraft if problems are discovered during theflight tests. Uncertainty over customer penalties and supplierclaims add to the 787s risks. Through November, the 787 accountedfor the bulk of Boeing's order cancellations (83 out of 111),although the company still has 840 firm orders for the aircraft.

-- Commercial Aftermarket/Services: The commercial aftermarket will likely be the first part of the aerospace industry to recover from the downturn. Fitch forecasts aftermarket spending will be flat to up 5% in 2010, with a weak first half offset by an improved second half. The expected economic rebound should drive airline traffic growth and eventually will lead to rising flight hours and capacity, which are the primary drivers of aftermarket spending. Some inventory rebuilding and completion of deferred maintenance should also help the aftermarket recover in 2010. Business jet utilization has also been improving off of a low base, which will aid aftermarket spending in that sector.

Fitch's general concern for the aftermarket is that currentconditions are still very weak, with many companies reportingdouble digit declines year-over-year in the third quarter. Somecapacity metrics are still negative despite indications ofincreased airline traffic. Fitch will have more conviction on theoutlook for this sector once capacity starts to increase.Companies with healthy exposures to this high-margin segmentinclude Goodrich, Honeywell, Rockwell Collins, Transdigm, andUnited Technologies.

-- The business jet market was the worst commercial aerospace sector in 2009, suffering a rapid and severe downturn. Industry deliveries fell 38% through September, and Fitch expects a 35%-40% unit decline for the year, with revenues likely down 25%-30%. An eventual peak-to-trough unit decline of 50% or more for the industry is not out of the question, and Fitch expects aircraft deliveries to fall another 5%-10% in 2010 from 2009 levels. The large unit declines result from hundreds of order cancellations and the failure of light jet manufacturer Eclipse Aviation.

Although utilization rates have started to rise and corporateprofits have turned up, Fitch expects continued weakness in thesector because utilization rates are still well below peak levelsand the corporate profit improvement is largely due to costcutting. This sector will continue to be volatile because of thediscretionary nature of the product, the availability of numeroussubstitute forms of travel, and the relationship to corporateprofits. A key development in the sector in the past five yearshas been strong orders from outside North America, and theseinternational orders could be the catalyst for an upturn beyond2010. Manufacturers in this sector include Bombardier, DassaultAviation, Embraer, General Dynamics, Hawker Beechcraft, andTextron, as well as key suppliers such as Honeywell.

-- The regional aircraft market (regional jets and turboprops) has many of the same drivers as the LCA market, but it has lower backlogs. Orders so far in 2009 have been weak, and the outlook for this sector is negative for 2010. Regional jets deliveries from Bombardier and Embraer will probably fall about 15% in 2009 and at least 15% in 2010, excluding possible deliveries from new entrants in the market. Fitch estimates that turboprop deliveries from Bombardier and ATR (a joint venture between EADS and Finmeccanica) will rise modestly in 2009, but they will likely decline 5% in 2010. New entrants into the regional jet market remain an important part of the sector's outlook, and in 2010 the market will likely see the initial deliveries of Sukhoi's Superjet 100 and China's ARJ21.

Defense:

High U.S. DoD spending levels continue to support defense sectorcredit quality, and the outlook is still favorable in the nearterm because spending in fiscal year 2010 will continue to rise.The core DoD budget should grow approximately 4% in FY2010, andmodernization spending (procurement plus R&D), the most relevantpart of the budget for defense contractors, should be up 2%-3%.Fitch believes that FY2010 is probably the peak in modernizationspending, and there are several risks to monitor in FY2011 andbeyond. These include the Obama Administration's first fullbudget in FY2011, the Quadrennial Defense Review, and the largeprojected federal budget deficits in FY2009-FY2011. In additionto spending levels, some other changes proposed by the newadministration could have a detrimental impact on defensecontractors, including acquisition reform and the 'insourcing' ofservices previously contracted out by the DoD.

Fitch believes core modernization spending could decline 1%-2% inFY2011, although the overall core budget could rise. The FY2011budget and QDR will likely continue the changes the Obamaadministration introduced in the current year's budget, and Fitchis not anticipating any dramatic shifts. Fitch expectssupplemental spending that supports operations in Iraq andAfghanistan will fall over the next several years, but for severalreasons the decline will be gradual, and the supplemental spendingwill not disappear. Spending related to Iraq will be down, butspending in Afghanistan will increase. Some security spending bythe U.S. in Iraq will likely be replaced by Iraqi governmentspending, which could continue to be a source of revenues to U.S.contractors. Finally, the DoD will need to refurbish or replacesome equipment and material that is in poor condition or left inIraq.

Given the strong credit metrics and liquidity at most of theleading defense contractors, ratings in the sector are unlikely tobe pressured by modest declines in modernization spending.Program execution and cash deployment probably present greaterrisks. Defense company backlogs fell in the first three quartersof 2009 due to some program cancellations, although orders in thefourth quarter could reverse some of the decline.

Liquidity and Cash Deployment:

Strong liquidity and financial flexibility helped the NorthAmerican A&D industry withstand the difficult economy in 2009, andthe industry even improved its liquidity position in the past 12months, although at the expense of increasing total debt to$60 billion from $55 billion. At the end of the third quarter thetop 15 A&D companies rated by Fitch in North America had$35 billion in cash compared to approximately $5 billion incurrent debt maturities and short-term debt. The only materialcredit facilities set to expire in 2010 (GD, L-3, and RTN) havealready been replaced.

Many companies in the sector pulled back on discretionaryexpenditures in 2009 (share repurchases fell $10 billion, forexample) in the interests of building liquidity. Withstabilization appearing in some parts of the A&D sector, Fitchexpects greater cash deployment in 2010. Acquisition activitybegan to increase in the past quarter, and Fitch expects this willcontinue in 2010. Share repurchases and dividend increases willlikely rise as well.

Higher pension contributions will be another use of cash in 2010.The A&D sector has seven of the largest 25 pension plans incorporate America, and some are significantly underfunded. Thesituation is mitigated for defense contractors, which get somerecovery of pension costs in government contracts. Harmonizationof Cost Accounting Standards and the Pension Protection Act issomething to watch during 2010.

In Fitch's view, Boeing will have the most significant liquiditypressures in 2010. Delays in the 787 and 747-8 programs over thepast 18 months have negatively affected Boeing's credit qualitybecause of inventory build-up, delayed advance payments, andhigher development expenses. Cash flow pressures will likelypersist into 2011 due to continued inventory build-up in supportof initial 787 deliveries. Although free cash flow will probablybe positive in 2009, Fitch believes that break-even or negativefree cash flow is possible in 2010 depending on the ultimateschedule for 787 deliveries, production rates on other aircraftmodels, and the company's working capital management, which hasbeen good in 2009 considering the 787 inventory pressures andreduced advances because of lower orders.

Aircraft Finance:

Fitch does not expect that financing availability will be a limiton aircraft deliveries in 2010, although some concerns remain inthe aircraft finance business. The aircraft finance market wasnot as bad as feared in 2009, and Fitch expects this trend tocontinue because credit markets have improved and lower forecastedaircraft deliveries will mean a lower financing requirement thanin 2009. Fitch projects funding requirements will be$60-$65 billion for LCA and regional aircraft in 2010, about$5 billion lower than in 2009. An additional $10-$15 billioncould be needed for business jets, also down versus 2009.

Concerns in the aircraft finance market include the damagedbusiness models of some large aircraft lessors, the exit of somebanks from the market, and indications that pre-delivery paymentfinancing was difficult for some airlines in 2009. Severalfactors offset these concerns, including strong support fromexport credit agencies, the emergence of some regional financialplayers in the market, better capital markets activity in the pastfew months, and the ability of Boeing and Airbus to providecustomer financing. Fitch estimates that ECAs could supportapproximately 25% of LCA deliveries in 2009, illustrating thebenefit the industry has received from indirect governmentsupport. It looks like Boeing and Airbus will finance less than$2 billion of new aircraft in 2009, leaving the companies with thecapacity to help customers in 2010 if needed. New aircraft serveas attractive lending collateral due to the mobility of theassets, operating efficiency compared to previous aircraftgenerations, and unique treatment in bankruptcy in somejurisdictions.

The comments above apply to new aircraft financing, notrefinancings of existing debt. Fitch estimates that there will be$14 billion of maturing airline debt in the U.S. alone in 2010-2011.

Economic Assumptions:

Underpinning Fitch's A&D outlook is the firm's most recent globaleconomic outlook, which as of October 2009 calls for global GDP toshrink 2.8% in 2009, followed by global growth recovery to 2% in2010 and 2.7% in 2011. GDP should rise, but from a low base, andexpansion will be weak relative to previous recoveries. There issome uncertainty in 2011 due to likely tightening of monetary andfiscal stimulus. Fitch expects GDP to grow 6.5% in the BRICcountries (Brazil, Russia, India, China) in 2010. Although globalGDP looks set to return to positive growth, the absolute level ofGDP is low and, in the U.S., it is possible that GDP may notreturn to the 2008 level until 2011.

Fitch's specific A&D assumptions include no recovery in 2010 otherthan early cycle parts such as aftermarket. Late cycle segmentssuch as original equipment will continue to be weak, showing somevolume declines, although nowhere near as dramatic as in 2009 orin the last downturn that began in 2001.

A more detailed report on the global 2010 aerospace & defenseindustry outlook will be available on the Fitch Ratings Web siteat 'www.fitchratings.com' in January.

Fitch-rated issuers and their current Issuer Default Ratings inthe North American aerospace/defense sector:

The Debtors did not file a list of their 20 largest unsecuredcreditors when they filed their petition.

The petition was signed by the Joint Debtors.

AMBAC FINANCIAL: Fails to Meet NYSE's $1 Per Share Requirement--------------------------------------------------------------Ambac Financial Group, Inc., on December 9 said that the New YorkStock Exchange has notified the Company that it has fallen belowthe NYSE's continued listing standard relating to the price of itscommon stock. The NYSE requires that the average closing price ofa listed Company's common stock be above $1.00 per share over aconsecutive 30 trading-day period. As of December 8, 2009, thedate of the NYSE notice, the 30 trading-day average closing priceof Ambac's common stock was $0.94 per share.

Under the NYSE's rules, Ambac has six months from the date of theNYSE notice to bring its share price and 30 trading-day averageshare price back above $1.00 in order to avoid the delisting ofits shares. During this period, Ambac's common stock willcontinue to be traded on the NYSE, subject to Ambac's compliancewith other NYSE continued listing requirements. As required bythe NYSE, in order to maintain the listing of its common shares,Ambac will notify the NYSE within 10 business days of receipt ofthe non-compliance notice of its intent to cure the pricedeficiency.

About Ambac

Ambac Financial Group, Inc., headquartered in New York City, is aholding company whose affiliates provide financial guarantees andfinancial services to clients in both the public and privatesectors around the world. Ambac's principal operating subsidiary,Ambac Assurance Corporation, a guarantor of public finance andstructured finance obligations, has a Caa2 rating (developingoutlook) from Moody's Investors Service, Inc. and a CC rating(outlook developing) from Standard & Poor's Ratings Services.Ambac Financial Group, Inc. common stock is listed on the New YorkStock Exchange (ticker symbol ABK).

AMERICAN INT'L: Treasury Says It May Not Get Full Investment------------------------------------------------------------Dow Jones Newswires' Meena Thiruvengadam reports that U.S.Treasury Secretary Timothy Geithner this week told theCongressional Oversight Panel, one of several entities overseeingthe Troubled Asset Relief Program, there is a significantlikelihood "we will not be repaid for the full value of ourinvestments in AIG, GM, and Chrysler."

Dow Jones notes the Treasury in fiscal year 2009 alone estimatedits losses on capital provided to those firms to be near $61billion.

According to a report released by the Government AccountabilityOffice -- and reported by the Troubled Company Reporter onNovember 10, 2009 -- the Treasury provided $81.1 billion aid tothe U.S. auto industry, of which $62 billion was provided toChrysler Group and GM to help the auto makers in theirrestructuring. In return, the government agency received 9.85%equity in Chrysler, 60.8% equity and $2.1 billion in preferredstock in GM, and $13.8 billion in debt obligations between theauto makers.

GAO estimated that the equity value of Chrysler Group necessary torecoup investment must be $54.8 billion while GM would need to beworth $66.9 billion. The agency also assumed that $5.4 billionthat was lent to Chrysler and $986 million to GM would not berepaid.

"Treasury is unlikely to recover the entirety of its investment inChrysler or GM, given that the companies' values would have togrow substantially above what they have been in the past," GAOsaid in its 41-page report.

In September 2008, AIG experienced a liquidity crunch when itscredit ratings were downgraded below "AA" levels by Standard &Poor's, Moody's Investors Service and Fitch Ratings. OnSeptember 16, 2008, the Federal Reserve Bank created an$85 billion credit facility to enable AIG to meet increasedcollateral obligations consequent to the ratings downgrade, inexchange for the issuance of a stock warrant to the Fed for 79.9%of the equity of AIG. The credit facility was eventuallyincreased to as much as $182.5 billion.

AIG has sold a number of its subsidiaries and other assets to paydown loans received from the U.S. government, and continues toseek buyers of its assets.

According to Dow Jones' Darrell A. Hughes and Ms. Thiruvengadam,Mr. Geithner said in letters to U.S. lawmakers, the Obamaadministration would extend the $700 billion financial-sectorbailout from its scheduled Dec. 31 expiration but limit newspending to such areas as housing and small business. The reportrelates Mr. Geithner said the financial sector has stabilized, butthe government needs to have funds available through next October.those aimed at job creation. The report notes that PresidentBarack Obama on Tuesday said the White House would use anadditional $50 billion in TARP funds to help small businesses getcredit.

"While we are extending the $700 billion program, we do not expectto deploy more than $550 billion," Mr. Geithner said, Dow Jonesreports. He added the U.S. would seek to exit its TARPinvestments "as soon as practicable."

About AIG

Based in New York, American International Group, Inc., is theleading international insurance organization with operation inmore than 130 countries and jurisdictions. AIG companies servecommercial, institutional and individual customers through themost extensive worldwide property-casualty and life insurancenetworks of any insurer. In addition, AIG companies are leadingproviders of retirement services, financial services and assetmanagement around the world. AIG's common stock is listed on theNew York Stock Exchange, as well as the stock exchanges in Irelandand Tokyo.

Chrysler LLC and 24 affiliates on April 30 sought Chapter 11protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead CaseNo. 09-50002). Chrysler hired Jones Day, as lead counsel; TogutSegal & Segal LLP, as conflicts counsel; Capstone Advisory GroupLLC, and Greenhill & Co. LLC, for financial advisory services; andEpiq Bankruptcy Solutions LLC, as its claims agent. Chrysler haschanged its corporate name to Old CarCo following its sale to aFiat-owned company. As of December 31, 2008, Chrysler had$39,336,000,000 in assets and $55,233,000,000 in debts. Chryslerhad $1.9 billion in cash at that time.

In connection with the bankruptcy filing, Chrysler reached anagreement with Fiat SpA, the U.S. and Canadian governments andother key constituents regarding a transaction under Section 363of the Bankruptcy Code that would effect an alliance betweenChrysler and Italian automobile manufacturer Fiat. Under theterms approved by the Bankruptcy Court, the company formerly knownas Chrysler LLC on June 10, 2009, formally sold substantially allof its assets, without certain debts and liabilities, to a newcompany that will operate as Chrysler Group LLC. Fiat has a 20percent equity interest in Chrysler Group.

General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. Withits global headquarters in Detroit, GM employs 209,000 people inevery major region of the world and does business in some 140countries. GM and its strategic partners produce cars and trucksin 34 countries, and sell and service these vehicles through thesebrands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,Vauxhall and Wuling. GM's largest national market is the UnitedStates, followed by China, Brazil, the United Kingdom, Canada,Russia and Germany. GM's OnStar subsidiary is the industry leaderin vehicle safety, security and information services.

GM acquired its operations from General Motors Company, n/k/aMotors Liquidation Company, on July 10, 2009, pursuant to a saleunder Section 363 of the Bankruptcy Code. Motors Liquidation orOld GM is the subject of a pending Chapter 11 reorganization casebefore the U.S. Bankruptcy Court for the Southern District of NewYork.

At September 30, 2009, GM had $107.45 billion in total assetsagainst $135.60 billion in total liabilities.

About Motors Liquidation

General Motors Corporation and three of its affiliates filed forChapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead CaseNo. 09-50026). General Motors changed its name to MotorsLiquidation Co. following the sale of its key assets to a company60.8% owned by the U.S. Government.

Bankruptcy Creditors' Service, Inc., publishes General MotorsBankruptcy News. The newsletter tracks the Chapter 11 proceedingundertaken by General Motors Corp. and its various affiliates.(http://bankrupt.com/newsstand/or 215/945-7000)

Proceeds of the financing will be used to repay the $77 millionoutstanding balance on the company's term loan, cash collateralizeabout $22 million of letters of credit, and fund transaction feesand expenses.

"The rating on AMN Healthcare Inc., a subsidiary of AMN HealthcareServices Inc., reflects the health staffing company's weakbusiness risk profile, given its narrow operating focus in acompetitive and highly cyclical field, the recent decline indemand for outsourced labor from hospital clients, and thevariable supply of travel nurses," said Standard & Poor's creditanalyst Rivka Gertzulin. Although AMN's revenue in the thirdquarter of 2009 declined about 47% over the 2008 period, operatingmargins have remained relatively stable as the company has reducedits variable costs. Moreover, the company has used itssignificant free cash flow in 2009, mostly generated from workingcapital (accounts receivable), to repay debt. As a result, thecompany's significant financial risk profile is commensurate withthe rating.

ANTHRACITE CAPITAL: Delisting Cues Default Under Senior Notes-------------------------------------------------------------Richard M. Shea, President and Chief Operating Officer ofAnthracite Capital, Inc., reports that events of default haveoccurred on the outstanding $43.5 million aggregate principalamount of 1.25%-to-7.22% Senior Notes due 2016, $7.5 millionaggregate principal amount of 1.25%-to-7.20% Senior Notes due 2016and $26.4 million aggregate principal amount of 1.25%-to-7.772%-to-Floating Rate Senior Notes due 2017 of Anthracite Capital as aresult of the commencement of the delisting procedures by the NewYork Stock Exchange on -- and the suspension of listing on theNYSE of -- the Company's common stock.

As reported by the Troubled Company Reporter, NYSE on December 1,2009, announced the immediate suspension of listing on the NYSE ofthese equity securities of Anthracite Capital:

NYSE Regulation, Inc., determined the Company was no longersuitable for listing in light of the abnormally low price of theCompany's common stock after the Company's December 1 announcementthat discussed defaults and cross-defaults on certain of itsunsecured and secured debt obligations. The Company's commonstock closed at $0.24 with a resultant market capitalization of$22.6 million on December 1, 2009.

Under the indentures governing the Senior Notes, while the eventsof default are continuing, the trustee or the holders of at least25% in aggregate principal amount of any of the three series ofthe outstanding Senior Notes may, by a written notice to theCompany, declare the principal amount of such series of SeniorNotes to be immediately due and payable. To date, the Company hasnot received any written notice of acceleration.

Furthermore, as a result of the Delisting, holders of roughly$39 million aggregate principal amount of the Company'soutstanding 11.75% Convertible Senior Notes due 2027 may requestthe Company to repurchase in cash in whole or in part theConvertible Notes at a price set pursuant to the indenturegoverning the Convertible Notes.

The Company does not anticipate being able to meet such repurchaseobligations. If the Company were to fail to provide a writtennotice to the holders of the Convertible Notes setting forthdetails of repurchase within 15 days after the Delisting, orrepurchase any Convertible Notes upon request, an event of defaultwould occur under the indenture governing the Convertible Notes.

Default

Anthracite Capital did not make interest payments, when due onOctober 30, 2009, on its outstanding $13.75 million aggregateprincipal amount of 7.22% Senior Notes due 2016, its outstanding$28 million aggregate principal amount of 7.772%-to-floating rateSenior Notes due 2017 and its outstanding $37.5 million aggregateprincipal amount of 8.1275%-to-floating rate Senior Notes due2017. Under the indentures governing the Senior Notes, thecontinuance of an interest payment default for a period of 30 daysconstitutes an event of default. The Company failed to make theinterest payments on the Senior Notes within this 30-day period.As a result, an event of default occurred and is continuing undereach of the indentures governing the Senior Notes.

The Company said the events of default have triggered cross-default provisions in the Company's secured bank facilities andits credit facility with BlackRock Holdco 2, Inc., and, if anydebtwere accelerated, would trigger a cross-acceleration provision inthe Company's convertible notes indenture. If acceleration wereto occur, the Company would not have sufficient liquid assetsavailable to repay such indebtedness and, unless the Company wereable to obtain additional capital resources or waivers, theCompany would be unable to continue to fund its operations orcontinue its business.

The Company also said one of its secured bank lenders, DeutscheBank, whose loans to the Company were made under a repurchaseagreement, has informally indicated to the Company that it intendsto exercise its remedy of taking the collateral under therepurchase agreement. Under the repurchase agreement, DeutscheBank must give the Company at least five business days' writtennotice before it may exercise this remedy. As of December 1, theCompany has not received any such written notice from DeutscheBank. Approximately $58 million principal amount of indebtednessremains outstanding under the Company's repurchase facility withDeutsche Bank.

The Company is discussing the events of default and situation withcertain of its creditors, but there can be no assurance that suchdiscussions will result in the continuing operations of theCompany.

The Company said December 1 the cash flows from substantially allof its assets are being diverted to a cash management account forthe benefit of the Company's secured bank lenders due to thecontinuation of the Company's default on amortization paymentsrequired under such secured bank facilities.

Management's assessment of the Company's liabilities and thecurrent market value of the Company's assets suggests that, in theevent of a reorganization or liquidation of the Company in thenear term, shareholders would not receive any value and the valuereceived by the Company's unsecured creditors would be minimal.

About Anthracite Capital

Anthracite Capital, Inc. is a specialty finance company focused oninvestments in high yield commercial real estate loans and relatedsecurities. Anthracite is externally managed by BlackRockFinancial Management, Inc., which is a subsidiary of BlackRock,Inc., one of the largest publicly traded investment managementfirms in the United States with approximately $1.435 trillion inglobal assets under management at September 30, 2009. BlackRockRealty Advisors, Inc., another subsidiary of BlackRock, providesreal estate equity and other real estate-related products andservices in a variety of strategies to meet the needs ofinstitutional investors.

At September 30, 2009, the Company had $2,601,125,000 in totalassets against $2,064,290,000 in total liabilities, $23,237,000 in12% Series E-1 Cumulative Convertible Redeemable Preferred Stock,and $23,237,000 in 12% Series E-2 Cumulative ConvertibleRedeemable Preferred Stock, resulting in stockholders' equity of$490,361,000.

ARCLIN US: Modified Plan Confirmed by Court-------------------------------------------Bill Rochelle at Bloomberg News reports that the reorganizationplan for Arclin US Holdings Inc. was approved in a Dec. 8confirmation order after the plan was modified to provide adistribution to unsecured creditors who were to receive nothingunder the original version for their $9.6 million in claims.

To mollify opposition from unsecured creditors who were deemed tohave voted "no," the Plan was modified to create a $600,000 fundfor distribution to unsecured creditors. Secured creditor can'tparticipate as unsecured creditors on account of their deficiencyclaims.

Under the Plan, holders of $204 million in first-lien debt arereceiving 97% of the new stock plus a new $60 million term loan.The plan will reduce funded debt to $60 million from $234 million.First-lien creditors were projected to recover 88.4 percent.Second-lien lenders owed $30 million have a "gift" from the first-lien creditors in the form of 3% of the new stock plus warrantsfor a predicted 40.4% recovery.

About Arclin US Holdings, Inc.

Based in Mississauga, Ontario, Arclin is a leading provider ofinnovative bonding and surfacing solutions for the building andconstruction, engineered materials and natural resource markets.Arclin provides bonding solutions for a number of applicationsincluding wood based panels, engineered wood, non-wovens and paperimpregnation. As a world leader in paper overlays technology,Arclin provides high value surfacing solutions for decorativepanels, building products and industrial specialty applicationsfor North American and export markets.

Arclin's Canadian companies also made a filing with the OntarioSuperior Court of Justice and have obtained an Initial Orderauthorizing Arclin to reorganize under the Companies' CreditorsArrangement Act. Ernst & Young serves as CCAA monitor.

Arclin's subsidiaries in Mexico are not included in the filings.The Mexican affiliates -- Arclin Mexican Holdings S.A. de C.V.,Arclin Mexico S.A. de C.V., and Arclin Operadora S.A. de C.V. --are not subject to any insolvency proceedings.

ART ADVANCE: Quebec Court OKs Amended Distribution Plan-------------------------------------------------------ART Advanced Research Technologies Inc. said the Quebec SuperiorCourt approved the amended proposal filed by ART under theBankruptcy and Insolvency Act. The Proposal provides for, amongother terms, the distribution of the sum of $375,000 to theunsecured creditors as well as a reorganization of ART's equitypursuant to Section 191 of the Canada Business Corporations Act.

The transactions contemplated by the Proposal including theReorganization are expected to be implemented and effective byDecember 11, 2009.

In consideration of the transactions contemplated under theProposal, Dorsky Worldwide Corp. settled the claims of securedcreditors of ART totaling close to $5 million and paid $375,000 tobe used by ART to pay a distribution to its unsecured creditors.

Upon the implementation of the Proposal and Reorganization, allexisting common and preferred shares and other equity of ART willbe automatically cancelled, without payment or compensation to theholders of such shares and equity, in accordance with the terms ofthe Court approved Proposal. This announcement follows theannouncement made on December 7, 2009 that the unsecured creditorsof ART voted unanimously in support of its Proposal under the BIA,as amended, at a meeting of Unsecured Creditors held that day.

About ART Advanced Research

Canada-based ART Advanced Research Technologies Inc. --http://www.art.ca/-- is a leader in molecular imaging products for the healthcare and pharmaceutical industries. ART hasdeveloped products in medical imaging, medical diagnostics,disease research, and drug discovery with the goal of bringing newand better treatments to patients faster. ART's shares are listedon the TSX under the ticker symbol ARA.

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ART Advanced announced November 2 it filed a notice of intentionto make a proposal to its creditors under the Bankruptcy andInsolvency Act with KPMG Inc. in order to provide the company withthe liquidity it requires to pursue its solicitation process. ARTwas also authorized pursuant to an order of the Quebec SuperiorCourt to enter into a loan agreement with Dorsky Worldwide Corp.for interim financing in an amount of up to $1,200,000.

APPLIED SOLAR: Sees Chapter 7 Conversion After Assets Sold----------------------------------------------------------ASI Liquidating Co., formerly Applied Solar, Inc., anticipatesthat its Chapter 11 bankruptcy case currently pending in the U.S.Bankruptcy Court for the District of Delaware will be converted toa Chapter 7 case in the near future, after which time a Chapter 7Trustee will be responsible for overseeing the liquidation of ASILiquidating Co.

The Company has previously completed the sale of substantially allof its assets to an affiliate of The Quercus Trust, whichaffiliate is operating these assets under the name "AppliedSolar." The remaining assets of the Company consist primarily ofcash received in the Asset Sale, in an amount that is notsufficient to pay all of its creditors in full. As a result, itis anticipated that the stockholders of ASI Liquidating Co. willnot receive any disbursement in connection with the liquidation ofASI Liquidating Co.

Applied Solar was formerly known as Barnabus Energy Inc., BarnabusEnterprises Inc. and Open Energy Corporation. Applied Solar Inc.and its affiliate Solar Communities I LLC filed for Chapter 11 onJuly 24 (Bankr. D. Del. Lead Case No. 09-12623). Katherine J.Clayton, Esq., represents the Debtors as counsel. In itspetition, the Debtor listed between $1 million and $10 million inassets, and between $10 million and $50 million in debts.

Chapter 11 debtor Applied Solar is now known ASI Liquidating Co.,following the 11 U.S.C. Sec. 363 sale of its assets to The QuercusTrust.

The Debtors will begin soliciting votes on the Plan followingapproval of the adequacy of the information in the DisclosureStatement.

According to the Disclosure Statement, the Plan is supported byholders of 70% of the prepetition unsecured notes who willbackstop the offering of secured notes used to fund the Plan.

The Plan contemplates (i) payment in full in cash either on orafter the effective date to holders of allowed (a) administrativeclaims, (b) fee claims, (c) priority tax claims, (d) DIP financingclaims, (e) other priority claims, and (f) prepetition securedcredit facility claims; (ii) to holders of the Kiewit Mt. Vernonsecured claim, the Kiewit Aurora West secured claim and othersecured claims, either reinstatement of such claims, a cashpayment or payments, or return of the collateral securing suchallowed other secured claims; (iii) to holders of prepetitionunsecured notes claims and general unsecured claims, a pro ratadistribution of the unsecured claims stock pool allocable to thedebtor against which such claims are allowed; (iv) to holders ofconvenience class claims, a cash payment equal to 35% of theallowed amount of such claims; (v) to holders of equity interestsin are holdings, the issuance of the warrants; and (vi) norecovery to holders of equity interests in the subsidiaries. Inno event will claim holders be entitled to receive value in excessof the allowed amount of their claims.

Holders of the $315.5 million in unsecured notes and unsecuredcreditors owed $15 million will receive their pro rata share of80% of the new stock.

Upon emergence from Chapter 11, the reorganized Debtors will issue$105 million in notes that will be secured by senior liens on allof the reorganized Debtors' assets and used to fund distributionsunder the plan as well as the reorganized Debtors' working capitalneeds post-emergence. The reorganized Debtors will also enterinto a $20 million secured asset-based lending facility after theeffective date which will be used to fund liquidity and workingcapital needs post-emergence.

The hearing to approve the Disclosure Statement is set forJan. 13. The confirmation hearing for approval of the Plan istentatively scheduled for Feb. 24.

Means of Implementation

1. Entry into Exit Financing:

(a) Senior secured notes will be issued by the Reorganized ARE Holdings and guaranteed by each of the Reorganized ARE Holdings' then existing domestic subsidiaries.

(b) Holders of allowed prepetition unsecured notes will be entitled to subscribe and acquire their pro rata share of (i) $105,000,000 in aggregate principal amount of the senior secured notes, and (ii) the shares of noteholder new equity.

The Company and all of its direct and indirect subsidiaries filedfor Chapter 11 on April 7, 2009 (Bankr. D. Del. Lead Case No.09-11214). Joel A. Waite, Esq., and Ryan M. Bartley, Esq., atYoung, Conaway, Stargatt & Taylor, serves as bankruptcy counsel tothe Debtors. Davis Polk & Wardwell is special tax counsel andHoulihan, Lokey, Howard & Zukin, Inc., is the financial advisor.Garden City Group, Inc., has been engaged as claims agent. DonaldJ. Detweiler, Esq., at Greenberg Traurig, LLP, serves as counselto the official committee of unsecured creditors. When it filedfor bankruptcy protection from its creditors, Aventine Renewablelisted between $100 million and $500 million each in assets anddebts.

AVISTAR COMMUNICATIONS: Registers 12.5MM Shares Under 2009 Plan---------------------------------------------------------------Stockholders of Avistar Communications Corporation on November 16,2009, approved the 2009 Equity Incentive Plan, which replaced theCompany's 2000 Stock Option Plan. On December 8, 2009, 20calendar days after the mailing of an Information Statementrelated to the 2009 Plan to the Company's stockholders, the 2009Plan became effective. The total number of shares reserved forissuance under the 2009 Plan is 12,543,791 shares of the Company'scommon stock.

Accordingly the Company filed a Registration Statement on Form S-8to register the 12,543,791 shares of common stock. The 12,543,791shares being registered under this Registration Statement include(i) 2,508,325 shares of the Company's common stock previouslyreserved for issuance under the 2000 Plan but not subject tooutstanding options under such plan, which have been moved to the2009 Plan, and (ii) up to 10,035,466 shares that may be added tothe 2009 Plan in the future (A) as shares reserved for issuanceunder the 2000 Plan and subject to options or similar awardsissued under such plan expire or otherwise terminate without beingexercised in full or are forfeited to or repurchased by theCompany, or (B) pursuant to the automatic annual increaseprovisions under the 2009 Plan.

At September 30, 2009, the Company had $2.4 million in totalassets, including $382,000 in cash and cash equivalents, against$14.9 million in total liabilities, resulting in stockholders'deficit of $12.5 million.

As reported by the Troubled Company Reporter on August 25, 2009,the Company said it was in discussions with the remaining holdersof its 4.5%Convertible Subordinated Secured Notes to convert theNotes into shares of common stock in January 2010 or extend theterm of the Notes.

The Nasdaq Stock Market, LLC, has determined to remove fromlisting the common stock of Avistar, effective at the open ofbusiness on August 31, 2009. Based on a review of informationprovided by the Company, Exchange Staff determined that theCompany no longer qualified for listing on the Exchange as itfailed to comply with Rule 5505(b)(2).

AXIANT LLC: NCO Group Cancels Contract for Assets-------------------------------------------------NCO Group Inc. will not start the auction but may still join thebidding for the assets of Axiant LLC. NCO Group terminated itsproposal to acquire Axiant LLC, saying it will continue to pursuethe asset sale in the bankruptcy process, according to a report byPatrick Lunsford at insideARM.

The parties were in talks for a stalking horse bid by NCO Group of$2 million plus the assumption of liabilities. Unless it wasoutbid at a January 25 auction, NCO Group would have been requiredto buy the assets at the contracted price. If it was outbid, NCOGroup, as stalking horse, would be entitled to a break-up fee.

Axiant had previously said that it was still in negotiations withthe proposed stalking horse bidder. It said that it will pursuean open auction if negotiations don't result to a definitivecontract.

Axiant contemplates a January 20, 2010 deadline for bids. Theauction will be held January 25 and the sale hearing two dayslater, on January 27. Closing is targeted to occur February 9.

The Court will consider approval of the proposed bidding processon December 14.

Bloomberg relates that, separately, the trustee is objecting tothe 8,500 claims filed by investors in so-called feeder funds thatin turn invested in the Madoff Ponzi scheme. The trustee contendsthat the feeder funds are the holders of the claims and theinvestors aren't entitled to have individual claims against theMadoff firm.

Mr. Rochelle said in an earlier report that Mr. Picard might endup suing Carl Shapiro, a philanthropist who claims he lost $545million in the Ponzi scheme. Saying he might sue for $1 billionin fake profits, Mr. Picard said the facts represented byMr. Shapiro's lawyers aren't the same that the trustee's staffworked up in their own investigation.

On December 15, 2008, the Honorable Louis A. Stanton of theU.S. District Court for the Southern District of New York grantedthe application of the Securities Investor Protection Corporationfor a decree adjudicating that the customers of BLMIS are in needof the protection afforded by the Securities Investor ProtectionAct of 1970. The District Court's Protective Order (i) appointedIrving H. Picard, Esq., as trustee for the liquidation of BLMIS,(ii) appointed Baker & Hostetler LLP as his counsel, and (iii)removed the SIPA Liquidation proceeding to the Bankruptcy Court(Bankr. S.D.N.Y. Adv. Pro. No. 08-01789) (Lifland, J.).

On April 13, 2009, former BLMIS clients filed an involuntaryChapter 7 bankruptcy petition against Bernard Madoff (Bankr.S.D.N.Y. 09-11893). The case is before Hon. Burton Lifland. Thepetitioning creditors -- Blumenthal & Associates Florida GeneralPartnership, Martin Rappaport Charitable Remainder Unitrust,Martin Rappaport, Marc Cherno, and Steven Morganstern -- assert$64 million in claims against Mr. Madoff based on the balancescontained in the last statements they got from BLMIS.

On April 14, 2009, Grant Thornton UK LLP as receiver placed MadoffSecurities International Limited in London under bankruptcyprotection pursuant to Chapter 15 of the U.S. Bankruptcy Code(Bankr. S.D. Fla. 09-16751).

The Chapter 15 case was later transferred to Manhattan. In June2009, Judge Lifland approved the consolidation of the Madoff SIPAproceedings and the bankruptcy case.

Judge Denny Chin of the U.S. District Court for the SouthernDistrict of New York on June 29, 2009, sentenced Mr. Madoff to150 years of life imprisonment for defrauding investors inUnited States v. Madoff, No. 09-CR-213 (S.D.N.Y.).

BERRY PLASTICS: Completes Acquisition of Pliant Corp.-----------------------------------------------------Berry Plastics Corporation said December 3, 2009, it has completedthe acquisition of 100% of the common stock of Pliant Corporationfor an acquisition purchase price of $561 million.

Pliant emerged from bankruptcy effective December 3, 2009, andbecame a wholly owned direct subsidiary of Berry. The acquisitionwas funded with the proceeds from the private placement of notesin October. As reported by the Troubled Company Reporter, BerryPlastics on October 29, 2009, said it would issue, through its twonewly formed, wholly owned subsidiaries:

-- $370 million of first priority senior secured notes due 2015; and

-- $250 million of second priority senior secured notes due 2014.

The First Priority Notes will bear interest at a rate of 8-1/4%payable semiannually, in cash in arrears, on May 15 andNovember 15 of each year, commencing May 15, 2010 and will matureon November 15, 2015.

The Second Priority Notes will bear interest at a rate of 8-7/8%payable semiannually, in cash in arrears, on March 15 andSeptember 15 of each year, commencing March 15, 2010, and willmature on September 15, 2014.

The newly acquired business will be operated as Berry's SpecialtyFilms Division and will be run by R. David Corey, the former ChiefOperating Officer of Pliant. Berry's current Flexible FilmsDivision will now be known as the Film Products Division.

A full-text copy of Berry's disclosure on Form 8-K filed with theSecurities and Exchange Commission is available at no charge at:

Headquartered in Schaumburg, Illinois, Pliant Corporation producesvalue-added film and flexible packaging products for personalcare, medical, food, industrial and agricultural markets. Pliantoperates 16 manufacturing facilities around the world, and employsapproximately 2,800 people with annual net sales of $900 millionfor the 12 months ended September 30, 2009. Barclays Capitalacted as the exclusive financial advisor to Apollo Management,Graham Partners and Berry Plastics in conjunction with the Pliantrestructuring process.

Pliant and 10 of its affiliates filed for Chapter 11 protection onJanuary 3, 2006 (Bankr. D. Del. Lead Case No. 06-10001). James F.Conlan, Esq., at Sidley Austin LLP, and Edmon L. Morton, Esq., andRobert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor,represented the Debtors in their restructuring efforts. TheDebtors tapped McMillan Binch Mendelsohn LLP, as Canadian counsel.As of September 30, 2005, the Company had $604.3 million in totalassets and $1.19 billion in total debts. The Debtors emergedfrom Chapter 11 on July 19, 2006.

Pliant Corp. and its affiliates again filed for Chapter 11 afterreaching terms of a pre-packaged restructuring plan. Thevoluntary petitions were filed February 11, 2009 (Bank. D. Del.Case Nos. 09-10443 through 09-10451). The Hon. Mary F. Walrathpresides over the cases. Jessica C.K. Boelter, Esq., at SidleyAustin LLP, in Chicago, Illinois, and Edmon L. Morton, Esq., atRobert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, inWilmington, Delaware, provide bankruptcy counsel to the Debtors.Epiq Bankruptcy Solutions LLC acts as claims and noticing agent.The U.S. Trustee for Region 3 appointed five creditors to serve onan official committee of unsecured creditors. The CreditorsCommittee selected Lowenstein Sandler PC as its counsel. As ofSeptember 30, 2008, the Debtors had $688.6 million in total assetsand $1.03 billion in total debts.

About Berry Plastics

Berry Plastics Corporation manufactures and markets plasticpackaging products, plastic film products, specialty adhesives andcoated products. At June 27, 2009 the Company had 64 productionand manufacturing facilities, with 58 located in the UnitedStates. Berry is a wholly-owned subsidiary of Berry PlasticsGroup, Inc. Berry Group is primarily owned by affiliates ofApollo Management, L.P. and Graham Partners. Berry, through itswholly owned subsidiaries operates in four primary segments: RigidOpen Top, Rigid Closed Top, Flexible Films, and Tapes/Coatings.The Company's customers are located principally throughout theUnited States, without significant concentration in any one regionor with any one customer.

At September 26, 2009, the Company had total assets of$4.401 billion against total liabilities of $4.079 billion,resulting in stockholders' equity of $321.7 million. BerryPlastics reported a net loss of $26.2 million for the fiscal yearended September 26, 2009, from a net loss of $101.1 million forfiscal year ended September 27, 2008, and net loss of$116.2 million for fiscal year ended September 27, 2008.

* * *

As reported by the Troubled Company Reporter on June 10, 2009,Standard & Poor's Ratings Services raised its corporate creditrating on Berry Plastics Group to 'B-' from 'SD' and the seniorunsecured debt rating to 'CCC' from 'D'. The recovery ratings onGroup's senior unsecured debt remain unchanged at '6', indicatingS&P's expectation for negligible recovery (0% to 10%) in a paymentdefault. S&P affirmed all its ratings on Group's wholly ownedoperating subsidiary Berry Plastics Corp. The outlook is stable.

BI-LO LLC: Rejects Delhaize Bid, Opts for Stand-Alone Plan----------------------------------------------------------Scuttlebiz's Tim Rausch relates that BI-LO LLC rejected the offerof Food Lion's Belgian-based owner, Delhaize, to pay $425 millionfor most of the Company, and decided to complete its Chapter 11bankruptcy proceeding with its own plan of reorganization.Delhaize offer had raised some questions about whether BI-LO'sstores would close after all become Food Lions.

As reported by the Troubled Company Reporter on Nov. 24, 2009, theCompany has filed a proposed Chapter plan, which is funded by a$150 million new equity investment from Lone Star Funds and $200million in debt.

About BI-LO

Headquartered in Mauldin, South Carolina, BI-LO LLC operates 214supermarkets in South Carolina, North Carolina, Georgia andTennessee and employs approximately 15,500 people.

BLUEHIPPO FUNDING: Wants Case Converted to Chapter 7 Liquidation----------------------------------------------------------------Barely more than two weeks after voluntarily filing for chapter 11protection, BlueHippo Funding, LLC and its affiliates has filed amotion requesting that their bankruptcy cases be converted tochapter 7 liquidation cases.

NetDockets says the motion is the apparent result of an orderentered on December 2 by Judge Kevin Gross. BlueHippo had soughta preliminary injunction and temporary restraining order againstits automated clearing house processor, Checkgateway LLC, which itasserted was wrongfully holding funds of BlueHippo and the otherdebtors. Judge Gross denied the motion for a preliminaryinjunction and TRO, and refused to direct Checkgateway to turnover the disputed funds to the Debtors.

According to NetDockets, BlueHippo said without those funds, itlacks sufficient funding "to satisfy administrative expenses thatwill continue to accrue if these cases are maintained in chapter11." BlueHippo said it has no choice but to seek conversion ofthe cases and liquidate under chapter 7.

BlueHippo Funding LLC is a direct marketer of computers toconsumers with poor credit records. The company generated $33.1million in sales during 2008 and $21.5 million through Septemberthis year. NetDockets says BlueHippo described itself as offeringcustomers with poor credit "an effective alternative way . . . topurchase computers and other electronic equipment." However, itsbusiness practices had been the subject of class action lawsuitsand legal action by the Federal Trade Commission. The net lossthis year is $1.8 million. BlueHippo is owned by Joseph K. Rensin.

BlueHippo Funding LLC and several affiliates filed for Chapter 11on November 23, 2009. The case is In re Distinctive Call ResponseLLC, 09-14154, U.S. Bankruptcy Court, District of Delaware(Wilmington). Eric Michael Sutty, Esq., at Fox Rothschild LLP, inWilmington, Delaware, represents the Debtors. BlueHippo said ithas assets of $10 million while debt is $12.1 million.

BLUMENTHAL PRINT: To Liquidate Assets; Leaves 160 Jobless---------------------------------------------------------Gary Evans at Furniture Today says Blumenthal Print Works Inc. isclosing its business after 80 years of operations, leaving about30 employees in its headquarters and 130 workers at its jacquardplant in Marion, South Carolina, without jobs.

As reported by the TCR on Dec. 3, the Company has been compelledto liquidate after the Bankruptcy Court allowed the secured lenderWhitney National Bank to foreclose its plant and most otherproperty.

Blumenthal Print Works -- http://www.blumenthalprintworks.com/-- operated a home furnishing and decorative fabric company. TheCompany and its affiliate, Blumenthal Mills, Inc., sold jacquard,circular knits and velours.

The Company filed for Chapter 11 protection on Oct. 20, 2008(Bankr. E.D. La. Case No. 08-12532). Blumenthal Mills also filedfor Chapter 11 protection. Bernard H. Berins, Esq., and Jan MarieHayden, Esq., at Heller Draper Hayden Patrick & Horn LLC, assistthe Debtors in their restructuring effort. The Debtors eachlisted assets of $1 million to $10 million and debts of$10 million to $50 million in their petitions.

BOMBARDIER INC: Fitch Says Sector's Outlook Steady, Risks Remain----------------------------------------------------------------Credit quality in the U.S. commercial aerospace industry willremain under pressure in 2010, while the U.S. defense sector islikely to experience more stability, according to Fitch Ratings.Fitch expects deliveries in all commercial aerospace originalequipment segments to decline in 2010, but aftermarket salesshould begin to improve modestly. Defense spending will continueto grow in the low single digits.

Credit metrics for many A&D companies deteriorated in 2009, butthey are likely to be steady in 2010. Profits and cash flowscould be helped by improvement in the high-margin aftermarket, thefull-year impact of 2009 cost reductions, and defense growth, butthey will be held back by higher pension expense and weakcommercial OE markets. Fitch says liquidity remains strong afterimproving in 2009 because of lower share repurchases and someopportunistic debt issuance, but the company expects cashdeployment will increase during 2010, particularly foracquisitions and pension contributions.

Key risks for the sector include the weak global economicrecovery, exogenous shocks (terrorism, disease pandemic, etc.),large U.S. government deficits, and execution on new programs.The 787 program remains a continuing source of risk for Boeing andits suppliers. Flight hours and airline traffic have moved off ofcyclical lows, but they remain at depressed levels. A generalrisk is that some production rates have not been revised downwardmaterially despite the weak economy. Fitch does not expect thatfinancing availability will be a limit on aircraft deliveries in2010, although some concerns remain in the aircraft financebusiness. Longer-term, Fitch considers the commercial outlooksolid because of large backlogs and the need to build aerospaceinfrastructure in developing regions.

-- Large Commercial Aircraft: Fitch expects LCA deliveries from Boeing and Airbus will decline approximately 5% in 2010 to 920 aircraft, with revenues down 5%-10%. These estimates incorporate the announced production cuts for the A320 family (down two aircraft per month) and B777 (down almost 30%), but they exclude possible 787 deliveries (discussed below). Fitch believes there is a strong chance of additional production cuts, but these are more likely to take place in 2011. Long manufacturing lead times, advance payment requirements, and indications of sold-out 2010 production schedules support the argument against additional cuts next year, unless they are announced in the next few months to take effect at the end of 2010.

Fitch's forecasts will include additional 5%-15% cuts beginning in2011. Fitch forecasts the additional LCA production reductions in2011 because of a moderate global economic recovery, airlinecapacity reductions in 2008 and 2009, substantial airline losses,and deliveries that are exceeding typical aircraft retirements.However, the eventual production declines should be moderaterelative to prior LCA cycles as a result of large backlogs,production restraint since the last downturn, some remainingoverbooking in the delivery plans, and the geographic diversity ofthe customer base. In addition, the long-term nature of aircraftassets, as well as operating cost savings, provide incentive forcustomers to continue taking delivery of aircraft despitecyclically weak airline traffic. If the projected production cutsare managed with sufficient lead time, both the manufacturers andthe supply base should be able to adjust their cost structures intime to prevent deterioration of their credit profiles.

Fitch expects LCA orders to be low in 2010 and 2011, acontinuation of the trend in 2009, in which there have been only287 net orders through November compared to 867 deliveries duringthe same period. There were 142 cancellations through November,and Boeing has indicated that it had approximately 215 deferralsin the first three quarters. Low orders are not a credit concerngiven that Boeing and Airbus had a combined backlog of 6,849aircraft at the end of November, equal to more than seven years ofproduction at estimated 2010 rates. Excluding 787 and A350backlogs, the industry still has almost six years worth of orders.

Boeing's 787 program will continue to be a key concern for the LCAsector and its supply base in 2010. If Boeing meets its currentschedule, Fitch estimates the company could deliver 10-15 787s inlate 2010, but there is considerable risk to the schedule,including an aggressive flight testing program, certification, andthe production ramp-up. Boeing will be building 787s through theflight testing program, exposing the company to the risk ofreworking some aircraft if problems are discovered during theflight tests. Uncertainty over customer penalties and supplierclaims add to the 787s risks. Through November, the 787 accountedfor the bulk of Boeing's order cancellations (83 out of 111),although the company still has 840 firm orders for the aircraft.

-- Commercial Aftermarket/Services: The commercial aftermarket will likely be the first part of the aerospace industry to recover from the downturn. Fitch forecasts aftermarket spending will be flat to up 5% in 2010, with a weak first half offset by an improved second half. The expected economic rebound should drive airline traffic growth and eventually will lead to rising flight hours and capacity, which are the primary drivers of aftermarket spending. Some inventory rebuilding and completion of deferred maintenance should also help the aftermarket recover in 2010. Business jet utilization has also been improving off of a low base, which will aid aftermarket spending in that sector.

Fitch's general concern for the aftermarket is that currentconditions are still very weak, with many companies reportingdouble digit declines year-over-year in the third quarter. Somecapacity metrics are still negative despite indications ofincreased airline traffic. Fitch will have more conviction on theoutlook for this sector once capacity starts to increase.Companies with healthy exposures to this high-margin segmentinclude Goodrich, Honeywell, Rockwell Collins, Transdigm, andUnited Technologies.

-- The business jet market was the worst commercial aerospace sector in 2009, suffering a rapid and severe downturn. Industry deliveries fell 38% through September, and Fitch expects a 35%-40% unit decline for the year, with revenues likely down 25%-30%. An eventual peak-to-trough unit decline of 50% or more for the industry is not out of the question, and Fitch expects aircraft deliveries to fall another 5%-10% in 2010 from 2009 levels. The large unit declines result from hundreds of order cancellations and the failure of light jet manufacturer Eclipse Aviation.

Although utilization rates have started to rise and corporateprofits have turned up, Fitch expects continued weakness in thesector because utilization rates are still well below peak levelsand the corporate profit improvement is largely due to costcutting. This sector will continue to be volatile because of thediscretionary nature of the product, the availability of numeroussubstitute forms of travel, and the relationship to corporateprofits. A key development in the sector in the past five yearshas been strong orders from outside North America, and theseinternational orders could be the catalyst for an upturn beyond2010. Manufacturers in this sector include Bombardier, DassaultAviation, Embraer, General Dynamics, Hawker Beechcraft, andTextron, as well as key suppliers such as Honeywell.

-- The regional aircraft market (regional jets and turboprops) has many of the same drivers as the LCA market, but it has lower backlogs. Orders so far in 2009 have been weak, and the outlook for this sector is negative for 2010. Regional jets deliveries from Bombardier and Embraer will probably fall about 15% in 2009 and at least 15% in 2010, excluding possible deliveries from new entrants in the market. Fitch estimates that turboprop deliveries from Bombardier and ATR (a joint venture between EADS and Finmeccanica) will rise modestly in 2009, but they will likely decline 5% in 2010. New entrants into the regional jet market remain an important part of the sector's outlook, and in 2010 the market will likely see the initial deliveries of Sukhoi's Superjet 100 and China's ARJ21.

Defense:

High U.S. DoD spending levels continue to support defense sectorcredit quality, and the outlook is still favorable in the nearterm because spending in fiscal year 2010 will continue to rise.The core DoD budget should grow approximately 4% in FY2010, andmodernization spending (procurement plus R&D), the most relevantpart of the budget for defense contractors, should be up 2%-3%.Fitch believes that FY2010 is probably the peak in modernizationspending, and there are several risks to monitor in FY2011 andbeyond. These include the Obama Administration's first fullbudget in FY2011, the Quadrennial Defense Review, and the largeprojected federal budget deficits in FY2009-FY2011. In additionto spending levels, some other changes proposed by the newadministration could have a detrimental impact on defensecontractors, including acquisition reform and the 'insourcing' ofservices previously contracted out by the DoD.

Fitch believes core modernization spending could decline 1%-2% inFY2011, although the overall core budget could rise. The FY2011budget and QDR will likely continue the changes the Obamaadministration introduced in the current year's budget, and Fitchis not anticipating any dramatic shifts. Fitch expectssupplemental spending that supports operations in Iraq andAfghanistan will fall over the next several years, but for severalreasons the decline will be gradual, and the supplemental spendingwill not disappear. Spending related to Iraq will be down, butspending in Afghanistan will increase. Some security spending bythe U.S. in Iraq will likely be replaced by Iraqi governmentspending, which could continue to be a source of revenues to U.S.contractors. Finally, the DoD will need to refurbish or replacesome equipment and material that is in poor condition or left inIraq.

Given the strong credit metrics and liquidity at most of theleading defense contractors, ratings in the sector are unlikely tobe pressured by modest declines in modernization spending.Program execution and cash deployment probably present greaterrisks. Defense company backlogs fell in the first three quartersof 2009 due to some program cancellations, although orders in thefourth quarter could reverse some of the decline.

Liquidity and Cash Deployment:

Strong liquidity and financial flexibility helped the NorthAmerican A&D industry withstand the difficult economy in 2009, andthe industry even improved its liquidity position in the past 12months, although at the expense of increasing total debt to$60 billion from $55 billion. At the end of the third quarter thetop 15 A&D companies rated by Fitch in North America had$35 billion in cash compared to approximately $5 billion incurrent debt maturities and short-term debt. The only materialcredit facilities set to expire in 2010 (GD, L-3, and RTN) havealready been replaced.

Many companies in the sector pulled back on discretionaryexpenditures in 2009 (share repurchases fell $10 billion, forexample) in the interests of building liquidity. Withstabilization appearing in some parts of the A&D sector, Fitchexpects greater cash deployment in 2010. Acquisition activitybegan to increase in the past quarter, and Fitch expects this willcontinue in 2010. Share repurchases and dividend increases willlikely rise as well.

Higher pension contributions will be another use of cash in 2010.The A&D sector has seven of the largest 25 pension plans incorporate America, and some are significantly underfunded. Thesituation is mitigated for defense contractors, which get somerecovery of pension costs in government contracts. Harmonizationof Cost Accounting Standards and the Pension Protection Act issomething to watch during 2010.

In Fitch's view, Boeing will have the most significant liquiditypressures in 2010. Delays in the 787 and 747-8 programs over thepast 18 months have negatively affected Boeing's credit qualitybecause of inventory build-up, delayed advance payments, andhigher development expenses. Cash flow pressures will likelypersist into 2011 due to continued inventory build-up in supportof initial 787 deliveries. Although free cash flow will probablybe positive in 2009, Fitch believes that break-even or negativefree cash flow is possible in 2010 depending on the ultimateschedule for 787 deliveries, production rates on other aircraftmodels, and the company's working capital management, which hasbeen good in 2009 considering the 787 inventory pressures andreduced advances because of lower orders.

Aircraft Finance:

Fitch does not expect that financing availability will be a limiton aircraft deliveries in 2010, although some concerns remain inthe aircraft finance business. The aircraft finance market wasnot as bad as feared in 2009, and Fitch expects this trend tocontinue because credit markets have improved and lower forecastedaircraft deliveries will mean a lower financing requirement thanin 2009. Fitch projects funding requirements will be$60-$65 billion for LCA and regional aircraft in 2010, about$5 billion lower than in 2009. An additional $10-$15 billioncould be needed for business jets, also down versus 2009.

Concerns in the aircraft finance market include the damagedbusiness models of some large aircraft lessors, the exit of somebanks from the market, and indications that pre-delivery paymentfinancing was difficult for some airlines in 2009. Severalfactors offset these concerns, including strong support fromexport credit agencies, the emergence of some regional financialplayers in the market, better capital markets activity in the pastfew months, and the ability of Boeing and Airbus to providecustomer financing. Fitch estimates that ECAs could supportapproximately 25% of LCA deliveries in 2009, illustrating thebenefit the industry has received from indirect governmentsupport. It looks like Boeing and Airbus will finance less than$2 billion of new aircraft in 2009, leaving the companies with thecapacity to help customers in 2010 if needed. New aircraft serveas attractive lending collateral due to the mobility of theassets, operating efficiency compared to previous aircraftgenerations, and unique treatment in bankruptcy in somejurisdictions.

The comments above apply to new aircraft financing, notrefinancings of existing debt. Fitch estimates that there will be$14 billion of maturing airline debt in the U.S. alone in 2010-2011.

Economic Assumptions:

Underpinning Fitch's A&D outlook is the firm's most recent globaleconomic outlook, which as of October 2009 calls for global GDP toshrink 2.8% in 2009, followed by global growth recovery to 2% in2010 and 2.7% in 2011. GDP should rise, but from a low base, andexpansion will be weak relative to previous recoveries. There issome uncertainty in 2011 due to likely tightening of monetary andfiscal stimulus. Fitch expects GDP to grow 6.5% in the BRICcountries (Brazil, Russia, India, China) in 2010. Although globalGDP looks set to return to positive growth, the absolute level ofGDP is low and, in the U.S., it is possible that GDP may notreturn to the 2008 level until 2011.

Fitch's specific A&D assumptions include no recovery in 2010 otherthan early cycle parts such as aftermarket. Late cycle segmentssuch as original equipment will continue to be weak, showing somevolume declines, although nowhere near as dramatic as in 2009 orin the last downturn that began in 2001.

A more detailed report on the global 2010 aerospace & defenseindustry outlook will be available on the Fitch Ratings Web siteat 'www.fitchratings.com' in January.

Fitch-rated issuers and their current Issuer Default Ratings inthe North American aerospace/defense sector:

-- Alliant Techsystems Inc. (ATK) ('BB'; Outlook Stable);

-- Boeing Company (BA) ('A+'; Outlook Negative);

-- Bombardier Inc. (BBD/B) ('BB+'; Outlook Negative);

-- General Dynamics Corporation (GD) ('A'; Outlook Stable);

-- Goodrich Corporation (GR) ('BBB+'; Outlook Stable);

-- Honeywell International Inc. (HON) ('A'; Outlook Negative);

-- ITT Corporation (ITT) ('A-'; Outlook Stable)

-- L-3 Communications Corporation (LLL) ('BBB-'; Outlook Stable);

-- Lockheed Martin Corporation (LMT) ('A-'; Outlook Stable);

-- Northrop Grumman Corporation (NOC) ('BBB+'; Outlook Stable);

-- Raytheon Company (RTN) ('A-'; Outlook Stable);

-- Rockwell Collins, Inc. (COL) ('A'; Outlook Stable);

-- Textron Inc. (TXT) ('BB+'; Outlook Negative);

-- Transdigm Group (TDG) ('B'; Outlook Stable);

-- United Technologies Corporation (UTC) ('A+'; Outlook Stable).

BUCKHEAD COMMUNITY: Receivership to Cue Lenders' Default Notice---------------------------------------------------------------Buckhead Community Bancorp, Inc., disclosed in a regulatory filingthat in connection with the receivership of The Buckhead CommunityBank, its wholly owned commercial banking subsidiary, both theCompany and the Bank expect to receive notices, from substantiallyall of the counterparties -- including, without limitation,lenders -- to the Company's or the Bank's material agreements, ofalleged events of default under those agreements, and of thosecounterparties' intentions to terminate those agreements oraccelerate the Company's or the Bank's performance of thoseagreements.

The Company or the Bank may dispute certain of those notices.However, in the event of a default by the Company or the Bankunder one or more of those material agreements, or in the event ofthe termination of one or more of the material agreements, theCompany's or the Bank's financial and other obligations under suchagreements may be accelerated. The Company or the Bank may besubject to penalties under those agreements and also may suffercross-default claims from counterparties under the Company's orthe Bank's other agreements.

As reported by the Troubled Company Reporter, the GeorgiaDepartment of Banking and Finance on December 4, 2009, closedBuckhead Community and the Federal Deposit Insurance Corporationwas named as the receiver of the Bank. The Company's principalasset is the common stock that it owns in the Bank, and, as aresult of the closure of the Bank, the Company has very limitedremaining tangible assets. As the owner of all of the capitalstock of the Bank, the Company would be entitled to the netrecoveries, if any, following the liquidation or sale of the Bankor its assets by the FDIC. However, at this time, the Company isunable to provide any assurance that any recovery will be realizedby the Company or the timing of any such recovery.

In connection with the closure of the Bank, the FDIC entered intoa purchase and assumption agreement with State Bank and TrustCompany of Macon, Georgia, pursuant to which State Bank assumedthe deposits of the Bank. Accordingly, depositors of the Bank,including those with deposits in excess of the FDIC's insurancelimits, will automatically become depositors of State Bank for thefull amount of their deposits, and they will continue to haveuninterrupted access to their deposits. Depositors will continueto be insured by the FDIC, so there is no need for customers tochange their banking relationship to retain their depositinsurance.

The Bank's seven offices reopened December 7, 2009, as branches ofState Bank. However, for a period of time, customers of bothbanks should continue to use their existing locations until StateBank can fully integrate the deposit records of the Bank.

State Bank purchased essentially all of the Bank's assets, whichtotaled approximately $874.0 million as of November 6, 2009, andentered into a loss-share transaction with the FDIC with respectto approximately $692 million of the Bank's assets.

To date, no other entity or newly chartered bank has been involvedin the process of closing and unwinding the Bank. The managementteams of the Company and the Bank have been working closely withthe Georgia Department, the FDIC and State Bank to make thetransition as smooth as possible for the Bank's customers.

The Buckhead Community Bank is the 125th FDIC-insured institutionto fail in the nation this year, and the 22nd in Georgia.

CANADIAN SUPERIOR ENERGY: Coughlin Stoia Files Class Suit---------------------------------------------------------Coughlin Stoia Geller Rudman & Robbins LLP disclosed that a classaction has been commenced in the United States District Court forthe Southern District of New York on behalf of purchasers of thecommon stock of Canadian Superior Energy Inc. between January 14,2008, and February 17, 2009, inclusive, seeking to pursue remediesunder the Securities Exchange Act of 1934. Canadian Superior isnot named in this action as a defendant as it sought protectionunder Canadian bankruptcy and reorganization laws and has sincereorganized.

The complaint charges certain of Canadian Superior's formerexecutives with violations of the Exchange Act. Canadian Superiorengages in the exploration for, acquisition, development, andproduction of petroleum and natural gas, and liquefied natural gasprojects primarily in western Canada, offshore Nova Scotia,offshore Trinidad and Tobago, the United States, and North Africa.

The complaint alleges that, throughout the Class Period,defendants failed to disclose material adverse facts about theCompany's true financial condition, business and prospects. OnAugust 16, 2007, Canadian Superior and Challenger Energy jointlyissued a press release announcing that BG International Limitedentered into a farm-in agreement and joint operating agreementwith Canadian Superior to participate in the exploration drillingand development of the Intrepid Block 5(c) (the "Joint Venture").Specifically, the complaint alleges that defendants failed todisclose: (i) that the discovered reserves for Intrepid Block 5(c)were below the economic threshold for development; (ii) thatCanadian Superior had notified BG of its intention to commence acorporate sale in November 2008 so that it could overcome thefinancial constraints that were preventing it from meeting itsfunding obligations under the Joint Operating Agreement; (iii)that Canadian Superior had violated the terms of the JointOperating Agreement with BG, thus potentially endangering itsinterest in the Joint Venture; (iv) that Canadian Superior failedto timely pay Maersk, the drilling operator, and potentially othercontractors, thereby jeopardizing the operation of the JointVenture; and (v) as a result of the foregoing, defendants lacked areasonable basis for their positive statements about the Company,its prospects and earnings growth.

On February 12, 2009, Canadian Superior issued a press releasingannouncing the "appointment, upon the application of BG of aninterim Receiver of its participating interest in Intrepid Block5(c). Pursuant to the Court Order, the Receiver, in conjunctionwith BG, will operate the property and conduct the flow testing ofthe Endeavour well which Canadian Superior believes will validateits operations to date." In response this announcement, shares ofthe Company's stock fell $0.40 per share, or 44%, from a close of$0.90 per share on February 11, 2009, the last trading date beforethe announcement, to close at $0.50 per share, on extremely heavytrading volume.

On February 17, 2009, Canadian Superior announced that it hadreceived a demand letter from the Canadian Western Bank forrepayment of all amounts outstanding under Canadian Superior's$45 million credit facility with the bank by February 23, 2009.The Company also announced that it was in discussions withalternative lenders. In response to this announcement, shares ofthe Company's stock fell $0.16 per share, or 30%, from a close of$0.54 per share on February 13, 2009, the last trading date beforethe announcement, to close at $0.38 per share, on extremely heavytrading volume.

Plaintiff seeks to recover damages on behalf of all purchasers ofCanadian Superior common stock during the Class Period. Theplaintiff is represented by Coughlin Stoia, which has expertise inprosecuting investor class actions and extensive experience inactions involving financial fraud.

Coughlin Stoia, a 190-lawyer firm with offices in San Diego, SanFrancisco, Los Angeles, New York, Boca Raton, Washington, D.C.,Philadelphia and Atlanta, is active in major litigations pendingin federal and state courts throughout the United States and hastaken a leading role in many important actions on behalf ofdefrauded investors, consumers, and companies, as well as victimsof human rights violations. The Coughlin Stoia Web site(http://www.csgrr.com)has more information about the firm.

CASCADE GRAIN: Ethanol Plant Sold to JH Kelly for $15MM-------------------------------------------------------The Bankruptcy Court approved the Chapter 7 sale of CascadeGrain's Clatskanie ethanol plant to JH Kelly LLC of Longview,Washington, for $15 million. JH Kelly, who built the Company'splant, was the only bidder for the facility.

According to Bill Rochelle at Bloomberg, the sale contract callsfor Kelly to pay $15 million, including a so-called credit bid asmuch as $11.5 million. The remainder is cash, with $3 milliongoing to other secured creditors plus $400,000 to the bankruptcytrustee.

According to Portland Business Journal, the state of Oregon has asecured claim of $20 million. Because secured claims total$120 million, the state will recover about $500,000, the reportsaid.

The book value of the plant was $177 million. Experts testifiedthat the market value ranged between $18 million and $55 million.

Cascade Grain Products LLC -- http://www.cascadegrain.com/-- is a member of a family of companies ultimately controlled by BerggruenHoldings Ltd. Cascade Grain Products has a 113.4-million gallonethanol plant in Oregon.

The U.S. Bankruptcy Court for the District of Oregon convertedCascade Grain's Chapter 11 reorganization case to Chapter 7liquidation.

CASCADES INC: Moody's Assigns 'Ba3' Rating on US$250 Mil. Notes---------------------------------------------------------------Moody's Investors Service assigned a Ba3 rating to Cascades Inc.'sproposed US$250 million senior notes due 2020. The rating outlookis stable. The expected use of proceeds from the note offering isto partially fund the tender offer of Cascades 7.25% and 6.75%senior notes maturing in 2013. The new notes will be unsecuredand will rank equally in right of payment with all of thecompany's existing senior unsecured indebtedness. The proposednotes will rank behind the company's senior secured bank facility(rated Baa3) and will be rated one notch below the corporatefamily rating, in accordance with Moody's loss-given-defaultmethodology. Cascades' Ba2 corporate family rating reflects thediversity derived from its containerboard, boxboard, specialtypackaging and tissue businesses, the relatively stable margins ofthese products, the improved financial performance of the boxboardsegment, and the company's vertically integrated operations.Offsetting these strengths are the company's lack of geographicdiversification, exposure to the strong Canadian dollar, volatileinput costs and the company's tendency to conduct relatively smalldebt-financed acquisitions. The company's SGL-2 liquidity ratingreflects expectations of continued positive free cash flowgeneration, the company's borrowing capacity under its committedbank lines, expectations of ongoing compliance with financialcovenants, no significant near term debt maturities, and strongalternative liquidity potential from assets sales. The stablerating reflects Moody's expectations that the company's improvedfinancial and operating performance will be sustained as economicconditions improve.

Assignments:

Issuer: Cascades Inc.

-- Senior Unsecured Regular Bond/Debenture, Assigned Ba3

Moody's last rating action on Cascades was on November 18, 2009,when Moody's assigned a Ba3 rating to the company's proposedsenior notes due 2016 and 2017.

Headquartered in Kingsey Falls, Quebec, Cascades is apredominantly North American producer of recycled boxboard,containerboard, and specialty packaging and tissue products.

"The 'BB-' corporate credit rating on Cascades reflects what S&Pview as the company's good market position in consolidatedmarkets, a diverse revenue stream, and vertical integration," saidStandard & Poor's credit analyst Jatinder Mall. These risks arepartially mitigated, in S&P's opinion, by what S&P view as thecompany's high debt levels, recent history of lower profitability,and exposure to cyclical boxboard and containerboard prices andvolumes.

The stable outlook reflects recent improvement in credit metricsand S&P's expectations that Cascades' profitability will improvein the next 12 months. Standard & Poor's could lower the ratingsif increasing fiber and energy costs lead to lower EBITDAgeneration, placing pressure on credit metrics and resulting in aleverage ratio of more than 5x. On the other hand, an upgradewould probably require Cascades to pay down debt and demonstrateits ability to sustain a leverage ratio of about 3.5x-4.0x.

Ratings List

Cascades Inc.

Corporate credit rating BB-/Stable/--

Rating Assigned

US$250 million senior unsecured notes B+ Recovery rating 5

CATHOLIC CHURCH: Wilmington Wants Withdrawals in Pooled Account---------------------------------------------------------------The Catholic Diocese of Wilmington, Inc., asks the U.S. BankruptcyCourt for the District of Delaware to issue:

(a) an interim order, pursuant to Sections 345(b), 363 and 105(a) of the Bankruptcy Code:

-- authorizing certain withdrawals from a pooled investment account for the benefit of the Diocese and certain pooled investors;

-- granting a further waiver of the deposit guidelines of Section 345(b) on an interim basis; and

-- scheduling a final hearing on their request; and

(b) a final order:

-- authorizing the continued use of the pooled investment program and the processing of withdrawal requests from pooled investors in the ordinary course;

-- waiving the deposit guidelines of Section 345 on a final basis; and

-- authorizing the Diocese to take all actions necessary or appropriate to transfer possession of Pooled Investment Funds to one or more non-debtor fiduciaries.

The request concerns a pooled investment account held by The Bankof New York Mellon, as custodian, pursuant to a custody agreementwith the Diocese. The Diocese maintains the custodial account onbehalf of itself and certain non-debtor parishes and otherCatholic entities, which mutually benefit from the aggregation oftheir investment capital and the sharing of overhead andtransaction costs.

The Diocese processes all deposits into, and withdrawals from, theaccount on behalf of the pooled investors, and maintains books andrecords detailing each investor's sub-account balances, allocatedgain or loss, and allocated costs and expenses. As ofSeptember 30, 2009, the value of the Diocese's assets in theaccount was approximately $44.2 million. The value of the non-debtors' assets in the account was approximately $76.2 million.

James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor,LLP, in Wilmington, Delaware, contends that it is not reasonablydisputable that the Diocese has no interest in assets contributedby non-debtors to the pooled investment account. Accordingly, hesays, those assets are not property of the Diocese's bankruptcyestate. However, he notes, even if the assets were property ofthe estate, the Diocese would be permitted to process withdrawalrequests made in the ordinary course of business in accordancewith the Diocese's historical practices and consistent with thepractices of other diocesan "pooled investment" programs in theUnited States of America.

Notwithstanding the fact, the Diocese did not seek relief withrespect to the pooled investment account in its first-daypleadings, save for seeking an interim waiver of the depositrequirements of Section 345, Mr. Patton asserts. To alleviate anyother concerns about the pooled investment program the Court orany parties-in-interest may have had, the Diocese agreed on therecord of the first-day hearing in the case not to make anydeposits into or withdrawals from the pooled investment accountfor at least 30 days absent a Court order.

The voluntary freeze on the pooled investment account was atemporary solution to avoid unnecessary controversy whilepermitting an official committee of unsecured creditors time toget organized and to perform due diligence. The freeze, however,cannot continue indefinitely because substantially all the liquidassets and working capital of the Diocese and certain of the non-debtor pooled investors are tied up in the pooled investmentaccount, Mr. Patton contends. He adds that continued inability toaccess amounts held in the pooled investment fund will prejudicethese entities, their ministries, and the communities andindividuals they serve.

Although the Diocese would be within its rights to resume ordinarycourse transfers into and out of the pooled investment accountfollowing expiration of its self-imposed, 30-day moratorium, thecustodian for the pooled investment account has expressed concernabout permitting any transfers from the account and has indicatedit may freeze the account, including any trading within theinvestment funds, pending further Court order, Mr. Patton tellsthe Court. Thus, he says, the Diocese needs at least interimrelief from the Court to make certain withdrawals from the pooledinvestment account and to process certain withdrawal requests fromnon-debtor pooled investors so as to avoid undue harm.

With respect to the Diocese's assets in the pooled investmentaccount, the United States Trustee has expressed concern that theaccount does not comply with the requirements of Section 345. TheDiocese believes the pooled investment account will yield themaximum reasonable net return on the Diocese's liquid assets, andthat a final waiver of the Section 345 deposit requirements wouldbe appropriate.

Nevertheless, Mr. Patton avers, even if the Court were todetermine that a final waiver is inappropriate, the Diocese isdubious that liquidating and transitioning approximately$44.2 million of diversified investments into a money marketaccount or other 345-compliant investment vehicle could beaccomplished prior to expiration of the current interim waiver.Thus, he explains, the Diocese will need a further interim waiverof the Section 345 deposit requirements to afford it time to workthrough these issues with the United States Trustee and theOfficial Committee of Unsecured Creditors.

Beyond their immediate need to access their liquid assets andworking capital, the non-debtor pooled investors have expressedconcern that requests for withdrawals from the pooled investmentaccount may be delayed by the bankruptcy process going forward,Mr. Patton relates.

The Diocese believes the long-term solution with respect to thepooled investment account may be to transition administration fromthe Diocese to a non-debtor fiduciary that can provide the non-debtor pooled investors more direct access to their funds while atthe same time preserving the benefits of a single, aggregatedinvestment pool. One solution, which the Diocese had consideredprepetition is to transfer the pooled investors' interests in thepooled investment account to one or more holding entities thatwill have a direct contractual relationship with the custodian,thus permitting non-debtors to make deposits and withdrawalswithout interference by the bankruptcy process and withoutimplicating the Diocese's cash management system.

Obviously, Mr. Patton notes, the long-term solution will requireinput from the U.S. Trustee and the Creditors Committee, amongothers. Accordingly, the Dioceses seek relief in two stages:

(a) interim relief that will alleviate the immediate concerns of the Diocese, the non-debtor pooled investors, and the custodian by permitting limited transactions pending a hearing on full notice to all parties-in-interest; and

(b) final relief including a permanent Section 345 waiver, authorization to process deposits and withdrawal requests of non-debtors, and authorization to take actions necessary and appropriate to allow the administration of the pooled investment program to be transitioned to a non-debtor fiduciary.

The Official Committee of Unsecured Creditors, Jacobs & Crumplar,P.A., and The Neuberger Firm, P.A., which firms represent manyunsecured creditors asserting a personal injury claim against theDiocese, and the Bank of New York Mellon separately filedobjections against the request.

The Creditors Committee argues that the relief sought concerns theprimary monetary issue in the bankruptcy case -- which is whatassets are available to satisfy the claims of abuse victims. TheCreditors Committee and the two firms contend that if the Courtpermits the proposed withdrawal, the economic heart of the casewould be destroyed. The Bank of New York asks for certainlanguages for addition to the proposed form of order of therequest, including its release from liability for processing anywithdrawal requests from the Diocese.

* * *

The Court granted the request on an interim basis, following ashortened notice period.

Prior to the entry of the interim order, the Official Committee ofUnsecured Creditors asked the Court to reconsider the shortenednotice period with respect to the request. The CreditorsCommittee asserted that its professionals cannot meaningfullyreview and analyze the thousands of pages of documents that havenow been made available by the Diocese relating to the request.

Subject to the terms of the Custody Agreement, Judge Sontchiauthorized the Diocese to make withdrawals from the pooledinvestment account and to process withdrawal requests of non-debtor pooled investors without further Court order, up to theseapplicable amounts:

Judge Sontchi also authorized the Diocese to continue to investand deposit funds into the pooled investment account in accordancewith its prepetition practices, without the need for a bond orother collateral as required by Section 345(b), and the entitieswith which the Diocese's pooled investment funds are deposited andinvested will be excused from full compliance with therequirements of Section 345(b) until 45 days following thedocketing of a final order directing compliance with Section345(b) as to specific accounts following the second interimhearing on the relief requested.

The request's second interim hearing is currently set forJanuary 4, 2010.

About the Diocese of Wilmington

The Diocese of Wilmington covers Delaware and the Eastern Shore ofMaryland and serves about 230,000 Catholics. The Delaware dioceseis the seventh Roman Catholic diocese to file for Chapter 11protection to deal with lawsuits for sexual abuse. Previousfilings were by the dioceses in Spokane, Washington; Portland,Oregon; Tucson, Arizona; Davenport, Iowa, Fairbanks, Alaska; andSan Diego, California.

Joseph P. Corsini, chief financial officer and treasurer of theCatholic Diocese of Wilmington, Inc., discloses that the Dioceseearned income from assessments and annual appeal during the twoyears immediately preceding 2009:

The Diocese made gifts or charitable contributions to certainparishes and missions within one year immediately preceding thePetition Date. A list of gifts and contributions made isavailable for free at:

During the past 12 months, in the ordinary course of business, Mr.Corsini relates that the Diocese paid two professionals, whoprovided services relating to debt counseling and bankruptcypreparation: (i) Young Conaway Stargatt & Taylor LLP for $304,451,and (ii) The Raemakers Group, LLC, for $171,404.

Mr. Corsini further reveals that the Diocese holds or controlsthese properties for another person or entity:

The Catholic Diocese of Wilmington, Inc., filed with the U.S.Bankruptcy Court for the District of Delaware a report on thevalue, operations and profitability of those entities in which thebankruptcy estate holds a substantial or controlling interest, asrequired by Rule 2015.3 of the Federal Rules of BankruptcyProcedure.

To recall, the bankruptcy case of the Archdiocese of Portland inOregon was reopened on February 15, 2009, for the limited purposeof resolving Erin K. Olson's request to unseal Docket Nos. 4765and 4766, and the Archdiocese's request to appoint a specialmaster and alternative request to defer protective order issuepending outcome of arbitration, and request to preserveconfidentiality.

On July 13, 2009, those requests were resolved by the BankruptcyCourt's entry of its order lifting protective order, lifting theseal on filed documents, and authorizing the release of depositiontranscripts.

Father M. and Father D. subsequently filed a notice of appeal ofthe Lift Order, and also a request to extend time for filingnotice of appeal. On August 11, 2009, the Bankruptcy Courtentered its order allowing request to extend. The appeal iscurrently pending in the United States District Court for theDistrict of Oregon.

On November 20, 2009, the record on appeal was transmitted to theDistrict Court, and no further proceedings in the bankruptcy caseare either necessary or required, the Court held.

About Archdiocese of Portland

The Archdiocese of Portland in Oregon filed for Chapter 11protection (Bankr. Ore. Case No. 04-37154) on July 6, 2004.Thomas W. Stilley, Esq., and William N. Stiles, Esq., at SussmanShank LLP, represent the Portland Archdiocese in its restructuringefforts. Albert N. Kennedy, Esq., at Tonkon Torp, LLP, representsthe Official Tort Claimants Committee in Portland, and scores ofabuse victims are represented by other lawyers. David A. Forakerserves as the Future Claimants Representative appointed in theArchdiocese of Portland's Chapter 11 case. In its Schedules ofAssets and Liabilities filed with the Court on July 30, 2004, thePortland Archdiocese reports $19,251,558 in assets and$373,015,566 in liabilities.

CCS MEDICAL: Goes to Auction as Judge Nixes Prepacked Plan----------------------------------------------------------CCS Medical Inc. will conduct an auction for its assets onFebruary 15 after its prepackaged Chapter 11 plan failed to winconfirmation from the Bankruptcy Court.

CCS Medical negotiated a plan before the Chapter 11 filing in Julythat would have converted $350 million of first-lien debt into allof the new stock and $200 million in new notes. The projectedrecovery on the first-lien claims was between 66% and 82%. Secondlien-lenders and other lower ranked creditors won't receiveanything.

According to Bill Rochelle at Bloomberg News, the holders of $110million in second-lien debt persuaded the bankruptcy judge not toapprove the plan during confirmation hearings in October. Thejudge decided that the company had failed to prove the Company wasworth less than $350 million, and thereby justifying wiping outall creditors aside from the first-lien lenders.

The report relates that at the confirmation hearings, theCompany's expert said the business was worth no more than $286million, according to a court filing by CCS. The expert for thesecond-lien creditors estimated the value was as high as $500million.

To resolve the question of what the company is worth, CCSprevailed on the judge to set up auction and sale procedures.

The bidding procedures, among other things, provide thatinterested parties are required to submit a letter of intent on orbefore January 11, 2010, at 11:59 p.m. (EST). The deadline forqualified parties to submit qualifying bids is February 8, 2010 at4:00 p.m. (EST). If qualifying bids are received, an auction willtake place on February 15, 2010, at the offices of the Company'slegal counsel Willkie Farr & Gallagher LLP in New York. A hearingto approve the sale would then occur on February 17, 2010, whichthe Company expects would allow for a conclusion of itsrestructuring within the following weeks.

About CCS Medical

Founded in 1994, CCS Medical Inc. -- http://www.ccsmed.com/-- has become a leading provider of medical supplies. CCS Medicalassists patients that need diabetes test strips, insulin pumps,urological supplies, ostomy supplies, advanced wound caredressings and prescription drugs. Clear Water, Florida-based CCSMedical specializes in providing a convenient way for patients toreceive supplies for their chronic illnesses in a manner thatsaves them time and money.

Monterey, California-based Cedar Funding Inc. --http://www.cedarfundinginc.com/-- was a mortgage lender. It filed a Chapter 11 petition on May 26, 2008 (Bankr. N.D. Calif.Case No. 08-52709). Judge Marilyn Morgan presides over the case.Cecily A. Dumas, Esq., at Friedman, Dumas and Springwater, in SanFrancisco, represents the Debtor, and R. Todd Neilson serves asthe Chapter 11 Trustee. Cedar Funding, Inc., accepted manymillions of dollars from hundreds of individuals who believed theywere acquiring fractional interests in loans that were secured byreal property. Many more invested with CFI through a relatedentity, Cedar Funding Mortgage Fund LLP, that acquired fractionalinterests in the name of the Fund. CFI failed to recordassignments of its deeds of trust that would have providedsecurity interests to most of its investors, including the Fund.The Debtor estimated assets of less than $50,000 and debts of$100 million to $500 million in its Chapter 11 petition.

CHRYSLER LLC: Treasury Admits May Not Get Full Investment---------------------------------------------------------Dow Jones Newswires' Meena Thiruvengadam reports that U.S.Treasury Secretary Timothy Geithner this week told theCongressional Oversight Panel, one of several entities overseeingthe Troubled Asset Relief Program, there is a significantlikelihood "we will not be repaid for the full value of ourinvestments in AIG, GM, and Chrysler."

Dow Jones notes the Treasury in fiscal year 2009 alone estimatedits losses on capital provided to those firms to be near $61billion.

According to a report released by the Government AccountabilityOffice -- and reported by the Troubled Company Reporter onNovember 10, 2009 -- the Treasury provided $81.1 billion aid tothe U.S. auto industry, of which $62 billion was provided toChrysler Group and GM to help the auto makers in theirrestructuring. In return, the government agency received 9.85%equity in Chrysler, 60.8% equity and $2.1 billion in preferredstock in GM, and $13.8 billion in debt obligations between theauto makers.

GAO estimated that the equity value of Chrysler Group necessary torecoup investment must be $54.8 billion while GM would need to beworth $66.9 billion. The agency also assumed that $5.4 billionthat was lent to Chrysler and $986 million to GM would not berepaid.

"Treasury is unlikely to recover the entirety of its investment inChrysler or GM, given that the companies' values would have togrow substantially above what they have been in the past," GAOsaid in its 41-page report.

In September 2008, AIG experienced a liquidity crunch when itscredit ratings were downgraded below "AA" levels by Standard &Poor's, Moody's Investors Service and Fitch Ratings. OnSeptember 16, 2008, the Federal Reserve Bank created an$85 billion credit facility to enable AIG to meet increasedcollateral obligations consequent to the ratings downgrade, inexchange for the issuance of a stock warrant to the Fed for 79.9%of the equity of AIG. The credit facility was eventuallyincreased to as much as $182.5 billion.

AIG has sold a number of its subsidiaries and other assets to paydown loans received from the U.S. government, and continues toseek buyers of its assets.

According to Dow Jones' Darrell A. Hughes and Ms. Thiruvengadam,Mr. Geithner said in letters to U.S. lawmakers, the Obamaadministration would extend the $700 billion financial-sectorbailout from its scheduled Dec. 31 expiration but limit newspending to such areas as housing and small business. The reportrelates Mr. Geithner said the financial sector has stabilized, butthe government needs to have funds available through next October.those aimed at job creation. The report notes that PresidentBarack Obama on Tuesday said the White House would use anadditional $50 billion in TARP funds to help small businesses getcredit.

"While we are extending the $700 billion program, we do not expectto deploy more than $550 billion," Mr. Geithner said, Dow Jonesreports. He added the U.S. would seek to exit its TARPinvestments "as soon as practicable."

About AIG

Based in New York, American International Group, Inc., is theleading international insurance organization with operation inmore than 130 countries and jurisdictions. AIG companies servecommercial, institutional and individual customers through themost extensive worldwide property-casualty and life insurancenetworks of any insurer. In addition, AIG companies are leadingproviders of retirement services, financial services and assetmanagement around the world. AIG's common stock is listed on theNew York Stock Exchange, as well as the stock exchanges in Irelandand Tokyo.

Chrysler LLC and 24 affiliates on April 30 sought Chapter 11protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead CaseNo. 09-50002). Chrysler hired Jones Day, as lead counsel; TogutSegal & Segal LLP, as conflicts counsel; Capstone Advisory GroupLLC, and Greenhill & Co. LLC, for financial advisory services; andEpiq Bankruptcy Solutions LLC, as its claims agent. Chrysler haschanged its corporate name to Old CarCo following its sale to aFiat-owned company. As of December 31, 2008, Chrysler had$39,336,000,000 in assets and $55,233,000,000 in debts. Chryslerhad $1.9 billion in cash at that time.

In connection with the bankruptcy filing, Chrysler reached anagreement with Fiat SpA, the U.S. and Canadian governments andother key constituents regarding a transaction under Section 363of the Bankruptcy Code that would effect an alliance betweenChrysler and Italian automobile manufacturer Fiat. Under theterms approved by the Bankruptcy Court, the company formerly knownas Chrysler LLC on June 10, 2009, formally sold substantially allof its assets, without certain debts and liabilities, to a newcompany that will operate as Chrysler Group LLC. Fiat has a 20percent equity interest in Chrysler Group.

General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. Withits global headquarters in Detroit, GM employs 209,000 people inevery major region of the world and does business in some 140countries. GM and its strategic partners produce cars and trucksin 34 countries, and sell and service these vehicles through thesebrands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,Vauxhall and Wuling. GM's largest national market is the UnitedStates, followed by China, Brazil, the United Kingdom, Canada,Russia and Germany. GM's OnStar subsidiary is the industry leaderin vehicle safety, security and information services.

GM acquired its operations from General Motors Company, n/k/aMotors Liquidation Company, on July 10, 2009, pursuant to a saleunder Section 363 of the Bankruptcy Code. Motors Liquidation orOld GM is the subject of a pending Chapter 11 reorganization casebefore the U.S. Bankruptcy Court for the Southern District of NewYork.

At September 30, 2009, GM had $107.45 billion in total assetsagainst $135.60 billion in total liabilities.

About Motors Liquidation

General Motors Corporation and three of its affiliates filed forChapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead CaseNo. 09-50026). General Motors changed its name to MotorsLiquidation Co. following the sale of its key assets to a company60.8% owned by the U.S. Government.

Bankruptcy Creditors' Service, Inc., publishes General MotorsBankruptcy News. The newsletter tracks the Chapter 11 proceedingundertaken by General Motors Corp. and its various affiliates.(http://bankrupt.com/newsstand/or 215/945-7000)

CIB MARINE: To Hold Teleconference for Shareholders December 18---------------------------------------------------------------CIB Marine Bancshares Inc. will hold on Dec. 18, 2009, at 11:00a.m., an informational teleconference for its shareholders toprovide a general update on the status of the Company and thebank, as well as discuss the current status of its efforts torestructure its debt and plans.

Joseph P. Hickey, Jr., president and chief executive of thecompany, said the company was unable to hold an annual shareholdermeeting this year due to the timing of the plan of reorganization.Mr. Hickey noted that the company will need to wait until its 2009annual report on Form 10-K as been filed with the Securities andExchange Commission before it can schedule it next annual meetingof shareholders, which it expect to hold in late spring of nextyear.

CIB Marine Bancshares is asking holders of its trust preferredsecurities to give advance approval of a pre-packaged plan ofreorganization under Chapter 11 of the Bankruptcy Code that wouldinvolve conversion of their debt securities to preferred stock.

Under the Plan of Reorganization, roughly $105.3 million of high-interest cumulative indebtedness would be exchanged for 55,624shares of Series A 7% fixed rate perpetual noncumulative preferredstock with a stated value of $1,000 per share and 4,376 shares ofSeries B 7% fixed rate convertible perpetual preferred stock witha stated value of $1,000 per share. Each share of CIB Marine'sSeries B Preferred would be convertible into 4,000 shares of theCompany's common stock only upon the consummation of a mergertransaction involving the company. The Company Preferred wouldhave no stated redemption date and holders could never force theCompany to redeem it.

According to the Troubled Company Reporter on Nov. 2, 2009, CIBMarine Bancshares, Inc. disclosed that the federal bankruptcycourt has confirmed the company's pre-packaged plan ofreorganization under Chapter 11 of the United States BankruptcyCode.

CIT GROUP: Nancy Foster to Leave Exec. VP Post December 31----------------------------------------------------------In a regulatory filing with the Securities and ExchangeCommission, CIT Group, Inc., disclosed that on December 1, 2009,Nancy J. Foster notified the Company that she was resigning asExecutive Vice President and Chief Credit & Risk Officer at theCompany effective December 31.

Ms. Foster is working with the Company to facilitate a transitionof her responsibilities and plans to start her own consultingpractice based in New York, according to CIT Senior Vice Presidentand Chief Compliance Officer James P. Shanahan.

About CIT Group

CIT Group Inc. (NYSE: CIT) -- http://www.cit.com/-- is a bank holding company with more than $60 billion in finance and leasingassets that provides financial products and advisory services tosmall and middle market businesses. Operating in more than 50countries across 30 industries, CIT provides an unparalleledcombination of relationship, intellectual and financial capital toits customers worldwide. CIT maintains leadership positions insmall business and middle market lending, retail finance,aerospace, equipment and rail leasing, and vendor finance.Founded in 1908 and headquartered in New York City, CIT is amember of the Fortune 500.

CIT Group on November 1 announced that, with the overwhelmingsupport of its debtholders, the Board of Directors voted toproceed with the prepackaged plan of reorganization for CIT GroupInc. and a subsidiary that will restructure the Company's debt andstreamline its capital structure. None of CIT's operatingsubsidiaries, including CIT Bank, a Utah state bank, were ncludedin the filings.

At September 30, 2009, CIT Group had $69,188,600,000 in totalassets against $64,067,700,000. As of June 30, 2009, CIT Grouphad total assets of $71,019,200,000 against total debts of$64,901,200,000.

Eric Mandelbaum, senior vice president and deputy general counselat CIT, relates that since July 2009, FTI has provided financialadvisory to the Company and is therefore ideally positioned toserve as their financial advisors because of the institutionalknowledge it has developed regarding the Debtors' finance,operations and systems. Moreover, FTI enjoys a wealth ofexperience and excellent reputation for services in large andcomplex Chapter 11 cases.

As the Debtors' financial advisor, FTI will assist in areas ofreporting and communications, claims, operations and liquidity andother restructuring services. Pursuant to an EngagementAgreement, FTI will specifically provide:

(a) assistance to the Debtors in the preparation of financial related disclosures, including the Schedules of Assets and Liabilities, the Statement of Financial Affairs and Monthly Operating Reports;

(b) assistance with the development and implementation of a supplier communication center;

(c) assistance in the preparation of financial information for distribution to creditors and others, including, but not limited to, cash flow projections and budgets, cash receipts and disbursement analysis, analysis of various asset and liability accounts, and analysis of proposed transactions for which Court approval is sought;

(d) assistance with the identification of executory contracts and leases and performance of cost and benefit evaluations with respect to the affirmation or rejection of each;

(e) analysis of creditor claims by type, entity and individual claim, including assistance with development of databases, as necessary, to track those claims;

(f) assistance in the evaluation and analysis of avoidance actions, including fraudulent conveyances and preferential transfers;

(g) litigation advisory services with respect to accounting and tax matters, along with expert witness testimony on case-related issues as required by the Debtors;

(i) assistance with the identification and implementation of short-term cash management procedures;

(j) assistance and advice to the Debtors with respect to the identification of core business assets and the disposition of assets or liquidation of unprofitable operations;

(k) assistance with assessing the liquidity impact of transferring various platforms into the bank;

(l) services to support the efficient transition of control from the existing Board of Directors to the newly constituted Board of Directors;

(m) assistance in the preparation of information and analysis necessary for the confirmation of the Plan;

(n) advisory assistance in connection with the development and implementation of key employee incentive and other critical employee benefit programs; and

(o) render other general business consulting or other assistance as Debtors' management or counsel may deem necessary that are consistent with the role of a financial advisor and not duplicative of services provided by other professionals in the Chapter 11 cases.

The Debtors will pay FTI's professionals in accordance with thesehourly rates:

The Debtors will also reimburse FTI for its necessary out-of-pocket expenses.

At the conclusion of FTI's engagement, the Debtors will consider,in their sole discretion, an Incentive Fee based upon FTI'scontribution to the successful restructuring of the Debtors.

"CIT Group Inc. and FTI have not yet finalized an agreement on theterms and conditions of this Incentive Fee, but pursuant to aletter agreement dated October 31, 2009, they have agreed to do soby December 31, 2009," Mr. Mandelbaum specified.

Robert J. Duffy, senior managing consultant at FTI, related thatduring the 90-day period prior to the Petition Date, his firmreceived $5,004,965 from the Debtors for prepetition professionalservices performed and expenses incurred.

Furthermore, FTI's current estimate is that it has receivedunapplied advance payments from the Debtors in excess ofprepetition billings in the amount of $2,000,000. As agreedbetween the Debtors and FTI, the Advanced Payment will not be usedcompensate FTI for its prepetition services and expenses, which(i) will be held and applied against its final postpetitionbilling, and (ii) will not be placed in a separate account.

Mr. Duffy assures Judge Gropper that FTI is a "disinterestedperson" as that term is defined in Section 101(14) of theBankruptcy Code, as modified by Section 1107(b).

About CIT Group

CIT Group Inc. (NYSE: CIT) -- http://www.cit.com/-- is a bank holding company with more than $60 billion in finance and leasingassets that provides financial products and advisory services tosmall and middle market businesses. Operating in more than 50countries across 30 industries, CIT provides an unparalleledcombination of relationship, intellectual and financial capital toits customers worldwide. CIT maintains leadership positions insmall business and middle market lending, retail finance,aerospace, equipment and rail leasing, and vendor finance.Founded in 1908 and headquartered in New York City, CIT is amember of the Fortune 500.

CIT Group on November 1 announced that, with the overwhelmingsupport of its debtholders, the Board of Directors voted toproceed with the prepackaged plan of reorganization for CIT GroupInc. and a subsidiary that will restructure the Company's debt andstreamline its capital structure. None of CIT's operatingsubsidiaries, including CIT Bank, a Utah state bank, were ncludedin the filings.

At September 30, 2009, CIT Group had $69,188,600,000 in totalassets against $64,067,700,000. As of June 30, 2009, CIT Grouphad total assets of $71,019,200,000 against total debts of$64,901,200,000.

CIT GROUP: Emerges from Bankruptcy; Shares Start Trading on NYSE----------------------------------------------------------------CIT Group Inc. on Thursday confirmed it has emerged frombankruptcy having satisfied all of the conditions required toconsummate the prepackaged Plan of Reorganization. Thedistribution of CIT's new debt and equity securities has takenplace in accordance with the Company's confirmed Plan and the newcommon stock has commenced trading on the New York Stock Exchangeunder the symbol "CIT."

Additional information can be found in the Investor Relationssection of the Company's Web site, http://www.cit.com/or by calling the Restructuring Information Line at 866-967-1786 (toll-free) or 310-751-2686.

CIT Group Inc. (NYSE: CIT) -- http://www.cit.com/-- is a bank holding company with more than $60 billion in finance and leasingassets that provides financial products and advisory services tosmall and middle market businesses. Operating in more than 50countries across 30 industries, CIT provides an unparalleledcombination of relationship, intellectual and financial capital toits customers worldwide. CIT maintains leadership positions insmall business and middle market lending, retail finance,aerospace, equipment and rail leasing, and vendor finance.Founded in 1908 and headquartered in New York City, CIT is amember of the Fortune 500.

CIT Group on November 1 announced that, with the overwhelmingsupport of its debtholders, the Board of Directors voted toproceed with the prepackaged plan of reorganization for CIT GroupInc. and a subsidiary that will restructure the Company's debt andstreamline its capital structure. None of CIT's operatingsubsidiaries, including CIT Bank, a Utah state bank, were includedin the filings.

On December 8, the Court confirmed the Debtors' prepackaged plan.

At September 30, 2009, CIT Group had $69,188,600,000 in totalassets against $64,067,700,000. As of June 30, 2009, CIT Grouphad total assets of $71,019,200,000 against total debts of$64,901,200,000.

CIT GROUP: Files Registration Statement for New Common Stock------------------------------------------------------------CIT Group Inc. on December 9 filed a registration statement toregister under Section 12(b) of the Securities Exchange Act of1934 common stock, par value $0.01 per share, of the Company beingissued pursuant to the Debtors' prepackaged plan upon the filingwith the State of Delaware of the Company's Third Amended andRestated Certificate of Incorporation. The Common Stock replacesthe Company's prior common stock which was registered underSection 12(b) of the Act (which prior common stock was canceled asof the effective time of the Prepackaged Plan).

As reported by the Troubled Company Reporter, on December 8, 2009,the United States Bankruptcy Court for the Southern District ofNew York confirmed the Modified Second Amended Prepackaged Plan ofReorganization of CIT Group and CIT Group Funding Company ofDelaware LLC.

As of the Confirmation Date, the Company's Third Amended andRestated Certificate of Incorporation provided for 600,000,000shares of authorized New Common Stock, of which 200,000,000 sharesof New Common Stock will be issued on the Effective Date, and100,000,000 shares of authorized new preferred stock, par value$0.01 per share, of which no shares will be issued on theEffective Date. The Company has reserved 10,526,316 shares forfuture issuance under the Amended and Restated CIT Group Inc.Long-Term Incentive Plan. In addition, in the event that theconditions to issuance of New Common Stock on account of thecontingent value rights allocated under the Plan are satisfied onthe 60th day following the Effective Date, the Company may issue asubstantial number of additional shares of New Common Stock. TheCompany will not make any distribution of New Common Stock onaccount of the contingent value rights if such conditions are notsatisfied on the 60th day following the Effective Date.

Pursuant to the Certificate, CIT's authorized capital stockconsists of: (1) 600,000,000 shares of Common Stock and (2)100,000,000 shares of preferred stock, par value $0.01 per shareEach share of Common Stock entitles the holder thereof to one voteon all matters, including the election of directors, and, exceptas otherwise required by law or provided in any resolution adoptedby our board of directors with respect to any series of preferredstock, the holders of the shares of Common Stock will possess allvoting power. The Certificate does not provide for cumulativevoting in the election of directors.

Approval of these three matters requires the vote of holders of66-2/3% of CIT's outstanding capital stock entitled to vote in theelection of directors: (1) amending, repealing or adopting of by-laws by the stockholders; (2) removing directors (which ispermitted for cause only); and (3) amending, repealing or adoptingany provision that is inconsistent with certain provisions ofCIT's certificate of incorporation. The holders of Common Stockdo not have any preemptive rights. There are no subscription,redemption, conversion or sinking fund provisions with respect tothe common stock.

CIT Restricts Sale of Shares

To protect certain tax attributes of the Company followingemergence from bankruptcy, the Certificate imposes certainrestrictions on the transfer of the Common Stock. During theRestriction Period, unless approved by the Board in accordancewith the procedures set forth in the Certificate, any attemptedtransfer of Common Stock shall be prohibited and void ab initio tothe extent that, as a result of such transfer (or any series oftransfers of which such transfer is a part), either (i) any personor group of persons shall become "5% shareholder" of the Company(as defined in Treasury Regulation Section 1.382-2T(g)) or (ii)the ownership interest in the Company of any 5% shareholder willbe increased.

Nothing in the Tax Attribute Preservation Provision will prevent aperson from transferring Common Stock to a new or existing "publicgroup" of the Company, as defined in Treasury Regulation Section1.382-2T(f)(13) or any successor regulation.

The period during which the transfer restrictions apply willcommence on the date of confirmation of the Prepackaged Plan andwill generally remain in effect until the earlier of (a) 45 daysafter the second anniversary of the date of confirmation, and (b)the date that the Board determines that (1) the consummation ofthe Prepackaged Plan did not satisfy the requirements of section382(1)(5) of the Internal Revenue Code or treatment under thatsection of the Internal Revenue Code is not in the best interestof the Company, (2) an ownership change, as defined under theInternal Revenue Code, would not result in a substantiallimitation on the ability of the Company to use otherwiseavailable tax attributes, or (3) no significant value attributableto such tax benefits would be preserved by continuing the transferrestrictions.

Material Features of Confirmed Plan

The material features of the Plan include:

-- Each holder of certain senior notes issued by Delaware Funding (formerly know as CIT Group Funding Company of Canada) will receive its pro rata share of five series of 10.25% Series B Second-Priority Secured Notes maturing in each year from 2013 through 2017 issued by Delaware Funding.

-- Each electing holder of certain long-dated senior unsecured notes and each holder of certain senior unsecured notes will receive its pro rata share of five series of 7.0% Series A Second-Priority Secured Notes maturing in each year from 2013 through 2017 issued by the Company and a specified percentage of the Company's new common stock, par value $0.01 per share.

-- Each non-electing holder of certain long-dated senior unsecured notes will have its current claim reinstated and will retain its current note.

-- Each holder of a claim arising under certain specified term loan agreements and credit agreements will receive its pro rata share of Series A Notes issued by the Company and a specified percentage of the New Common Stock.

-- Each holder of certain specified subordinated notes and junior subordinated notes will receive its pro rata share of a specified percentage of the New Common Stock plus contingent value rights.

-- Holders of equity interests in the Company shall have such equity interests cancelled, terminated and extinguished; however, holders of shares of the Company's preferred stock will receive contingent value rights.

-- The Company's Board of Directors -- which as of November 1, 2009 had nine members and as of December 8, 2009, had eight members -- has determined, and the Plan provides, that the appropriate size of the Board after the effective date of the plan would be 13 directors: (a) five of whom will consist of individuals who were serving as directors on November 1, 2009, (b) four of whom will be nominees proposed to the Nominating and Governance Committee of the Board by the steering committee of certain of the Company's lenders, (c) three of whom will be nominees proposed to the N&GC by the Company's noteholders (other than members of the Steering Committee) owning more than 1% of the aggregate outstanding principal amount of the Company's bonds and unsecured bank debt claims and (d) one of whom will be the Company's Chief Executive Officer. At the request of and in cooperation with the Steering Committee, the Company has engaged Spencer Stuart, an internationally recognized director search firm, to assist the N&GC in identifying, interviewing and selecting Steering Committee nominees. Spencer Stuart will identify candidates who are independent of the Company, not affiliated with, or representatives of, any of the members of the Steering Committee or the One-Percent Holders, and who possess the qualifications, skills and experience specified by the N&GC. The candidates that are approved by the N&GC will be submitted to the full Board for consideration for appointment with such appointment being subject to the review of the Federal Reserve Bank of New York. To the extent the N&GC, the Board or the Federal Reserve does not approve Steering Committee Nominees (whether such event occurs pre- or post-Effective Date), the Steering Committee shall be permitted to submit additional candidates to the N&GC until four members of the Board are Steering Committee Nominees.

As of October 31, 2009, the Company had 404,730,758 shares ofcommon stock issued and outstanding. As of September 30, 2009,the Company had issued and outstanding 14,000,000 shares of SeriesA Preferred Stock, 1,500,000 shares of Series B Preferred Stock,11,500,000 shares of Series C Preferred Stock and 2,330,000 sharesof Series D Preferred Stock. All of the outstanding shares of theCompany's common and preferred stock will be cancelled as of theEffective Date.

About CIT Group

CIT Group Inc. (NYSE: CIT) -- http://www.cit.com/-- is a bank holding company with more than $60 billion in finance and leasingassets that provides financial products and advisory services tosmall and middle market businesses. Operating in more than 50countries across 30 industries, CIT provides an unparalleledcombination of relationship, intellectual and financial capital toits customers worldwide. CIT maintains leadership positions insmall business and middle market lending, retail finance,aerospace, equipment and rail leasing, and vendor finance.Founded in 1908 and headquartered in New York City, CIT is amember of the Fortune 500.

CIT Group on November 1 announced that, with the overwhelmingsupport of its debtholders, the Board of Directors voted toproceed with the prepackaged plan of reorganization for CIT GroupInc. and a subsidiary that will restructure the Company's debt andstreamline its capital structure. None of CIT's operatingsubsidiaries, including CIT Bank, a Utah state bank, were includedin the filings.

On December 8, the Court confirmed the Debtors' prepackaged plan.

At September 30, 2009, CIT Group had $69,188,600,000 in totalassets against $64,067,700,000. As of June 30, 2009, CIT Grouphad total assets of $71,019,200,000 against total debts of$64,901,200,000.

CIT GROUP: Foster Quits as EVP and Chief Credit & Risk Officer--------------------------------------------------------------CIT Group Inc. reports that on December 1, 2009, Nancy J. Fosternotified the Company that she was resigning as Executive VicePresident and Chief Credit & Risk Officer effective December 31,2009. Ms. Foster is working with the Company to facilitate atransition of her responsibilities. Ms. Foster plans to start herown consulting practice based in New York.

CIT Group Inc. (NYSE: CIT) -- http://www.cit.com/-- is a bank holding company with more than $60 billion in finance and leasingassets that provides financial products and advisory services tosmall and middle market businesses. Operating in more than 50countries across 30 industries, CIT provides an unparalleledcombination of relationship, intellectual and financial capital toits customers worldwide. CIT maintains leadership positions insmall business and middle market lending, retail finance,aerospace, equipment and rail leasing, and vendor finance.Founded in 1908 and headquartered in New York City, CIT is amember of the Fortune 500.

CIT Group on November 1 announced that, with the overwhelmingsupport of its debtholders, the Board of Directors voted toproceed with the prepackaged plan of reorganization for CIT GroupInc. and a subsidiary that will restructure the Company's debt andstreamline its capital structure. None of CIT's operatingsubsidiaries, including CIT Bank, a Utah state bank, were includedin the filings.

On December 8, the Court confirmed the Debtors' prepackaged plan.

At September 30, 2009, CIT Group had $69,188,600,000 in totalassets against $64,067,700,000. As of June 30, 2009, CIT Grouphad total assets of $71,019,200,000 against total debts of$64,901,200,000.

Based in New York, Citigroup Inc. (NYSE: C) -- is a globaldiversified financial services holding company whose businessesprovide a broad range of financial services to consumer andcorporate customers. Citigroup has roughly 200 million customeraccounts and does business in more than 140 countries.Citigroup's businesses are aligned in three reporting segments:(i) Citicorp, which consists of Regional Consumer Banking (inNorth America, EMEA, Asia, and Latin America) and theInstitutional Clients Group (Securities and Banking, including thePrivate Bank, and Transaction Services); (ii) Citi Holdings, whichconsists of Brokerage and Asset Management, Local ConsumerLending, and a Special Asset Pool; and (iii) Corporate/Other.

As reported in the Troubled Company Reporter on November 25, 2008,the U.S. government entered into an agreement with Citigroup toprovide a package of guarantees, liquidity access, and capital.The U.S. Treasury and the Federal Deposit Insurance Corporationagreed to provide protection against the possibility of unusuallylarge losses on an asset pool of roughly $306 billion of loans andsecurities backed by residential and commercial real estate andother such assets, which will remain on Citigroup's balance sheet.As a fee for this arrangement, Citigroup issued preferred sharesto the Treasury and FDIC. The Federal Reserve agreed to backstopresidual risk in the asset pool through a non-recourse loan.

On December 10, 2009, Citigroup filed a "Client Strategy Guide:December 2009 Offerings". A full-text copy of the Guide isavailable at no charge at http://ResearchArchives.com/t/s?4b7c

About Citigroup Inc.

Based in New York, Citigroup Inc. (NYSE: C) -- is a globaldiversified financial services holding company whose businessesprovide a broad range of financial services to consumer andcorporate customers. Citigroup has roughly 200 million customeraccounts and does business in more than 140 countries.Citigroup's businesses are aligned in three reporting segments:(i) Citicorp, which consists of Regional Consumer Banking (inNorth America, EMEA, Asia, and Latin America) and theInstitutional Clients Group (Securities and Banking, including thePrivate Bank, and Transaction Services); (ii) Citi Holdings, whichconsists of Brokerage and Asset Management, Local ConsumerLending, and a Special Asset Pool; and (iii) Corporate/Other.

As reported in the Troubled Company Reporter on November 25, 2008,the U.S. government entered into an agreement with Citigroup toprovide a package of guarantees, liquidity access, and capital.The U.S. Treasury and the Federal Deposit Insurance Corporationagreed to provide protection against the possibility of unusuallylarge losses on an asset pool of roughly $306 billion of loans andsecurities backed by residential and commercial real estate andother such assets, which will remain on Citigroup's balance sheet.As a fee for this arrangement, Citigroup issued preferred sharesto the Treasury and FDIC. The Federal Reserve agreed to backstopresidual risk in the asset pool through a non-recourse loan.

Citigroup is one of the banks that, according to results of thegovernment's stress test, need more capital.

COLONIAL BANCGROUP: Creditors Want Chapter 7, Trustee-----------------------------------------------------A group of Colonial BancGroup Inc. creditors has asked thebankruptcy judge to convert the failed bank holding company'sChapter 11 case to Chapter 7, saying that there was no way toreorganize the Company and that liquidating it with the help of atrustee would yield more returns for creditors, according toLaw360.

Colonial BancGroup has just filed a motion to access cashcollateral to continue funding its four-month old Chapter 11 case.Earlier in the case, the bankruptcy court authorized using $1.43million in cash from one of several bank accounts holding a totalof $38.4 million. Alabama taxing authorities, Branch Banking &Trust Co., and the FDIC all claim security interests in thedepositaccounts.

Headquartered in Montgomery, Alabama, The Colonial BancGroup, Inc.(NYSE: CNB) was holding company to Colonial Bank, N.A, itsbanking subsidiary. Colonial bank -- http://www.colonialbank.com/-- operated 354 branches in Florida, Alabama, Georgia, Nevada andTexas with over $26 billion in assets. On August 14, 2009,Colonial Bank was seized by regulators and the Federal DepositInsurance Corporation was named receiver. The FDIC sold most ofthe assets to Branch Banking and Trust, Winston-Salem, NorthCarolina. BB&T acquired $22 billion in assets and assumed $20billion in deposits of the Bank.

COLONIAL BANCGROUP: Seeks Court Nod to Access Non-Deposits----------------------------------------------------------The Colonial BancGroup, Inc., is asking the U.S. Bankruptcy Courtfor the Middle District of Alabama for permission to:

-- use cash from sources other than the deposits to supplement the use of cash collateral; and

a) The State of Alabama Department of Revenue -- $9,000,000 which was revised to a sum less than $7 million.

b) BB&T -- $24,027,299 which amount remains on deposit with BB&T under prior orders of the Court and the Debtor does not seek to make any change in the status quo as to the funds; and

c) The FDIC-Receiver -- asserts a security interest in and a right of offset with respect to the deposits that is duplicative of the lien asserted by BB&T in the deposits and is based upon the same Security Agreement asserted by BB&T as the basis of its claim.

Headquartered in Montgomery, Alabama, The Colonial BancGroup, Inc.(NYSE: CNB) was holding company to Colonial Bank, N.A, itsbanking subsidiary. Colonial bank -- http://www.colonialbank.com/-- operated 354 branches in Florida, Alabama, Georgia, Nevada andTexas with over $26 billion in assets. On August 14, 2009,Colonial Bank was seized by regulators and the Federal DepositInsurance Corporation was named receiver. The FDIC sold most ofthe assets to Branch Banking and Trust, Winston-Salem, NorthCarolina. BB&T acquired $22 billion in assets and assumed $20billion in deposits of the Bank.

CONGOLEUM CORP: Ongoing Talks With Insurer Cue Plan Delay---------------------------------------------------------Congoleum Corporation requested the U.S. District Court for theDistrict of New Jersey, which is now presiding over its bankruptcycase to adjourn the hearing on the disclosure statement withrespect to its proposed plan of reorganization filed in October.

Congoleum wants the hearing postponed to a date in the first twoweeks of January to be determined by the District Court. Therequest was made jointly with the other plan proponents, theOfficial Committee of Bondholders and the Asbestos Claimants'Committee, and the request was granted by the District Court.

Roger S. Marcus, Chairman of the Board, commented, "We areactively engaged in settlement negotiations with the insurers thathave not previously settled their coverage disputes with us. Ifsuccessful, the terms of any further settlements will be describedin the disclosure statement. Given the progress that has beenmade in recent weeks, we and the other plan proponents felt it wasprudent to delay briefly the hearing to allow time for thenegotiations to run their course and permit the disclosurestatement to reflect their outcome. We are encouraged by thesedevelopments and continue to hope that we could see a planconfirmed in the first half of 2010."

As reported by the TCR on Oct. 27, 2009, Congoleum Corp. filedwith the U.S. District Court for the District of New Jersey aSecond Amended Joint Plan of Reorganization and an explanatorydisclosure statement on October 22. The confirmation hearings arescheduled to commence on March 29, 2010.

Congoleum filed the Second Amended Plan, at the behest of theDistrict Court. After reversing an order by the bankruptcy courtthat denied confirmation of Congoleum's plan and dismissing thechapter 11 case, the District Court directed the Debtors to file anew plan of reorganization that would provide for court review ofthe payments made to claimants' counsel and requested briefing onadditional confirmation issues.

In general, the Second Amended Plan provides, among other things,for the issuance of injunctions under section 524(g) of theBankruptcy Code that result in the channeling of all asbestosrelated liabilities of the Company into a Plan Trust. The SecondAmended Plan also provides for the issuance of 50.1% of the sharesof newly created Congoleum common stock to the trust, and 49.9% ofthe shares of newly created Congoleum common stock to the holdersof allowed senior note claims.

Various entities have filed bankruptcy plans for the Debtors. InFebruary 2008, the legal representative for future asbestos-related claimants; the asbestos claimants' committee; the officialCommittee of holders of the Company's 8-5/8 % Senior Notes dueAugust 1, 2008; and Congoleum jointly filed a joint plan ofreorganization. Various objections to the Joint Plan were filed.In June 2008, the Bankruptcy Court issued a ruling that the JointPlan was not legally confirmable.

In August 2008, the Bondholders' Committee, the ACC, the FCR,representatives of holders of prepetition settlements andCongoleum entered into a term sheet describing the proposedmaterial terms of a new plan of reorganization and a settlement ofavoidance litigation with respect to prepetition claim settlement.Certain insurers and a large bondholder filed objections to theLitigation Settlement or reserved their rights to object toconfirmation of the Amended Joint Plan. The Bankruptcy Courtapproved the Litigation Settlement in October 2008. The AmendedJoint Plan was filed in November 2008.

On February 27, 2009, Congoleum and the Bondholders' Committeeappealed the Order of Dismissal and the ruling denying planconfirmation to the U.S. District Court for the District of NewJersey. The District Court overturned the dismissal order, andassumed jurisdiction of the bankruptcy proceedings.

CONSECO INC: Projects $145MM to $170MM Operating Income in 2010---------------------------------------------------------------On Tuesday, Conseco, Inc., provided its outlook for earnings forthe full year 2010. The Company said it projects net operatingincome of between $145 million and $170 million in 2010. "Withall of the capital management actions we have taken over the lastyear and the changes in the financial markets, providinginformation regarding our operating income outlook at this time isimportant," said Conseco CEO Jim Prieur.

Net operating income is a non-GAAP measure commonly used in thelife insurance industry. This measure is defined by the Companyas net income applicable to common stock before net realizedinvestment gains or losses (net of related amortization and taxes)and the change in valuation allowance for deferred income taxes.Management of the Company says it uses this measure to evaluateperformance because realized investment gains or losses and thechange in the valuation allowance for deferred income taxes can beaffected by events that are unrelated to the Company's underlyingfundamentals.

The pre-tax operating income (loss) of the Company's segments in2010 are projected to be as follows:

-- Bankers Life $200 - $225 million

-- Conseco Insurance Group $110 - $125 million

-- Colonial Penn $24 - $30 million

-- Corporate $(43) - $(47) million

The projection assumes the continuation of the current interestrate environment in 2010, which, absent a change in the level andshape of the yield curve, will continue to negatively impactinvestment income and margins. The foregoing amounts also reflectthe impact of the previously announced transactions with Wilton Reinvolving (1) the reinsurance, effective January 1, 2009, of ablock of life insurance policies in the Conseco Insurance Groupsegment, which had pre-tax operating income in the first half of2009 of approximately $3.8 million per quarter before overhead;and (2) the reinsurance, to be effective October 1, 2009, of 50%of a block of life insurance policies in the Bankers Life segment,which had pre-tax operating income before overhead on the portionof the block being reinsured of approximately $2 million in thethird quarter of 2009. In addition, the expenses in conjunctionwith the previously announced merger of three of the Company'sinsurance subsidiaries, which are expected to be approximately$6 million, are included in the corporate segment projection.

After giving effect to the items described above and the issuanceof additional shares in the previously announced proposed publicoffering of common stock, the Company expects net operating incomeof between $0.60 and $0.70 per basic share and between $0.55 and$0.65 per diluted share in 2010.

These projections are based on currently available information anda number of assumptions, including the impact of the currentinterest rate environment, that the Company believes arereasonable as of the date of this press release.

About Conseco Inc.

Headquartered in Carmel, Indiana, Conseco Inc. (NYSE: CNO) --http://www.conseco.com/-- is the holding company for a group of insurance companies operating throughout the United States thatdevelop, market and administer supplemental health insurance,annuity, individual life insurance and other insurance products.The company became the successor to Conseco Inc. (Old Conseco), inconnection with its bankruptcy reorganization. CNO focuses onserving the senior and middle-income markets. The company sellsits products through three distribution channels: career agents,professional independent producers and direct marketing. CNOoperates through its segments, which includes Bankers Life,Conseco Insurance Group, Colonial Penn, other business in run-offand corporate operations.

* * *

Moody's Investors Service has affirmed the ratings of Conseco,Inc. (senior bank facility at Caa1) and its insurance subsidiaries(insurance financial strength at Ba2) and changed the outlook topositive from negative.

Standard & Poor's Ratings Services said that it affirmed its 'CCC'counterparty credit rating on Conseco Inc. and the 'BB-' financialstrength ratings on Conseco's insurance subsidiaries. S&P revisedthe outlook to stable from negative.

CONSECO INC: Seeks Amendments to Senior Credit Facility Covenants-----------------------------------------------------------------Conseco, Inc. reported Tuesday that it is seeking an amendment toits senior credit facility. The amendment would become effectiveupon the closing of the Company's previously announced proposedpublic offering of common stock. "This amendment would provideadditional covenant margin over the next two years, allowing usgreater focus on profitably growing our business segments andincreasing shareholder value," said Conseco CFO Ed Bonach.

The changes to the senior credit facility being sought wouldinclude:

-- the minimum risk-based capital ratio requirement would remain at 200% through December 31, 2010, and would increase to 225% for 2011 and 250% for 2012 (the risk-based capital requirement is currently scheduled to return to 250% after June 30, 2010);

-- the required minimum level of statutory capital and surplus would remain at $1.1 billion through December 31, 2010, and would increase to $1.2 billion for 2011 and $1.3 billion for 2012 (the required minimum level of statutory capital and surplus is currently scheduled to return to $1.27 billion after June 30, 2010);

-- the interest coverage ratio requirement would remain at 1.5x through December 31, 2010, and would increase to 1.75x for 2011 and 2.0x for 2012 (the interest coverage ratio requirement is currently scheduled to return to 2.0x after June 30, 2010); and

-- the debt to total capital ratio requirement would remain at 32.5% through December 31, 2009, and would change to 30.0% thereafter (the debt to total capital ratio requirement is currently scheduled to return to 30.0% after June 30, 2010).

In exchange for the covenant relief, Conseco would agree to pay$150 million of the first $200 million of net proceeds from itsproposed public offering of common stock to the lenders and, inaddition, to pay 50% of any net proceeds in excess of $200 millionfrom the offering. The credit facility currently requires theCompany to pay 50% of the net proceeds of any equity issuance tothe lenders.

The amendment would modify the Company's principal repaymentschedule to eliminate any principal payments in 2010 and providesfor principal payments of $35 million in 2011, $40 million in 2012and $40 million in 2013. The Company currently is required tomake principal repayments equal to 1% of the initial principalbalance each year, subject to certain adjustments, and to makeadditional principal repayments from excess cash flow. Thecurrent principal balance of the senior credit facility is$817.8 million, and the senior credit facility matures in October2013.

The amendment would also provide that the 1% payment in kind, orPIK, interest that has accrued since March 30, 2009, as anaddition to the principal balance under the senior credit facilitywould be replaced with a payment of an equal amount of cashinterest. The amount of accrued PIK interest (expected to beapproximately $6 million) would be paid in cash when the amendmentbecomes effective. The deletion of the 1% PIK interest and thepayment of an equal amount of cash interest would not impactreported interest expense. The amendment would become effectiveon the date, on or before January 15, 2010, (unless extended bythe agent for the lenders), on which the Company makes theprincipal payment described above from the net proceeds of thepublic offering of the common stock. In connection with theamendment, Conseco would expect to incur approximately$2.3 million of fees and expenses and to write off approximately$1 million of unamortized debt issuance costs.

As reported in the Troubled Company Reporter on November 27, 2009,Conseco Inc. filed a registration statement on Form S-1 forthe proposed sale to the public of the Company's common stock, parvalue $0.01 per share (and associated preferred stock purchaserights), with a proposed aggregate offering price of $230,000,000.The Company disclosed that the proposed sale will commence as soonas practicable after the registration statement is declaredeffective.

Headquartered in Carmel, Indiana, Conseco Inc. (NYSE: CNO) --http://www.conseco.com/-- is the holding company for a group of insurance companies operating throughout the United States thatdevelop, market and administer supplemental health insurance,annuity, individual life insurance and other insurance products.The company became the successor to Conseco Inc. (Old Conseco), inconnection with its bankruptcy reorganization. CNO focuses onserving the senior and middle-income markets. The company sellsits products through three distribution channels: career agents,professional independent producers and direct marketing. CNOoperates through its segments, which includes Bankers Life,Conseco Insurance Group, Colonial Penn, other business in run-offand corporate operations.

* * *

Moody's Investors Service has affirmed the ratings of Conseco,Inc. (senior bank facility at Caa1) and its insurance subsidiaries(insurance financial strength at Ba2) and changed the outlook topositive from negative.

Standard & Poor's Ratings Services said that it affirmed its 'CCC'counterparty credit rating on Conseco Inc. and the 'BB-' financialstrength ratings on Conseco's insurance subsidiaries. S&P revisedthe outlook to stable from negative.

The ratings on Houston-based Continental reflect its participationin the high-risk airline industry and a heavy debt and leaseburden, but also better-than-average operating performance amongits peer large U.S. hub and spoke airlines. S&P expectsContinental to maintain adequate liquidity over the next severalquarters, despite an expected prolonged weak, albeit improving,travel environment, so long as fuel prices do not increasesignificantly. If these conditions deteriorate, causingunrestricted cash and short-term investments to consistently fallbelow $2 billion (cash levels fluctuate somewhat with seasonalticket purchasing patterns, with the end of the second quarternear the high point and the end of the fourth quarter near the lowpoint), S&P could lower the ratings.

Ratings List

Continental Airlines Inc.

Corporate credit rating B/Negative/--

New Ratings Assigned

$230 million convertible notes due 2015 CCC+ Recovery rating 6

COREL CORP: Vector Acquires 3.0MM Shares; Raises Stake to 97%-------------------------------------------------------------Corel Holdings, L.P., Vector Capital Partners II International,Ltd. and Alexander R. Slusky disclosed that they have acquired3,076,078 shares of common stock of Corel Corporation that weretendered in a subsequent offering period through December 4, 2009.

The subsequent offering period expired at 12:00 midnight, New YorkCity time, on December 4, 2009. Based on information provided byCIBC Mellon Trust Company, the Depositary for the Offer, as of theexpiration of the subsequent offering period, approximately3,076,078 Shares were validly tendered during the subsequentoffering period, and when included with the 4,542,389 Sharestendered in the initial offering period, resulted in an aggregateof 7,618,467 Shares tendered pursuant to the Offer. VectorCapital has accepted for payment all Shares validly tendered, andpayment for such Shares will be made promptly in accordance withthe terms of the Offer.

Vector Capital anticipates completing a subsequent acquisitiontransaction to acquire all outstanding Shares not owned by VectorCapital and its affiliates at the same price per share as it paidin the Offer. Vector Capital expects that the subsequentacquisition transaction will close in February 2010. Followingthe subsequent acquisition transaction, Vector Capital will takesteps to de-register Corel as a public company and to therebycause the Company to become a private company owned by VectorCapital.

Corel Corp. (NASDAQ:CREL) (TSX:CRE) -- http://www.corel.com/-- is one of the world's top software companies with more than100 million active users in over 75 countries. The Companyprovides high quality, affordable and easy-to-use Graphics andProductivity and Digital Media software. The Company's productsare sold through a scalable distribution platform comprised ofOriginal Equipment Manufacturers (OEMs), the Company's global e-Stores, and the Company's international network of resellers andretail vendors.

The Company's product portfolio includes CorelDRAW(R) GraphicsSuite, Corel(R) Paint Shop Pro(R) Photo, Corel(R) Painter(TM),VideoStudio(R), WinDVD(R), Corel(R) WordPerfect(R) Office andWinZip(R). The Company's global headquarters are in Ottawa,Canada, with major offices in the United States, United Kingdom,Germany, China, Taiwan, and Japan.

At August 31, 2009, the Company had $189.7 million in total assetsagainst $199.7 million in total liabilities, resulting in$10.0 million in shareholders' deficit.

Corel's working capital deficiency at August 31, 2009, was$10.5 million, an increase of $7.7 million from the November 30,2008, working capital deficiency of $2.8 million.

* * *

As reported by the Troubled Company Reporter on November 3, 2009,Standard & Poor's Ratings Services lowered its long-term corporatecredit ratings on Ottawa-based packaged software provider CorelCorp. to 'B-' from 'B'. S&P also lowered the issue-level ratingon the company's senior secured credit facility by one notch to'B-' from 'B'. The '3' recovery rating on the debt is unchanged.

COYOTES HOCKEY: Ex-Owner Slams Ch. 7 Conversion Bid----------------------------------------------------Law360 reports that the former owner of the Phoenix Coyotes hockeyteam blasted a bid by the city of Glendale, Ariz., to convert theChapter 11 case to a Chapter 7, echoing the Debtors and unsecuredcreditors' belief that the city is trying to wriggle out of havingits bankruptcy claim estimated.

The former owners of the National Hockey League's Phoenix Coyoteshave filed a Chapter 11 plan of liquidation, to rebuff a call toconvert the proceedings to Chapter 7. The Debtor says thatconversion would merely prolong the wind-down and eat away at theliquidation trust proposed for the unsecured creditors.

In November 2009, Judge Redfield T. Baum approved the sale of thePhoenix Coyotes to the National Hockey League, which had boughtthe team to quash a plan by bidder Jim Balsillie's to move theteam to Ontario, Canada. Coyotes was sent to Chapter 11 toeffectuate a sale by owner Jerry Moyes to Mr. Balsillie.

DeCODE genetics, Inc., has sought the approval of the U.S.Bankruptcy Court for the District of Delaware to convene anauction where Saga would be lead bidder for its most valuableassets, including equity interests of its subsidiary ehf and otherassets related to the operations of ehf and its wholly-ownedIcelandic subsidiary including compounds DG041, DG051, and DG071.

Under a stalking horse agreement, the stalking horse bidder Saga -- a Delaware limited liability company formed by Polaris VenturePartners and ARCH Venture Partners to acquire ehf and assts of theDebtor related to Icelandic operations -- will (i) pay to theDebtor the Base Cash Price, which will be the greater of the$11 million or the Loan Amount; (ii) pay to the Debtor theAdditional Cash Price, which consists of 25% of the net cashproceeds from the sale, license, or other monetization of thePurchased Compounds received within 24 months after the Closingate minus $3 million; and (iii) will convey to the Debtor the Non-Cash Price, which is non-voting junior convertible, non-redeemablepreferred membership interests in the Stalking Horse Bidder with anon-participating liquidation preference of $7,153,845 in theaggregate.

The Debtor is seeking that a deadline for the submission of bidsbe set for December 17, 2009, at 5:00 p.m., and that the auctionbe held on December 21, 2009, at 10:00 a.m. The Debtor is alsoasking that the sale hearing be scheduled for December 22, 2009.The Debtor also proposes a December 15, 2009 deadline forobjecting to approval of the proposed sale.

About deCODE Genetics

deCODE Genetics Inc. is a global leader in analysing andunderstanding the human genome. deCODE has identified keyvariations in the sequence of the genome conferring increased riskof major public health challenges from cardiovascular disease tocancer, and employs its gene discovery engine to develop DNA-basedtests to assess individual risk of common diseases; to license itstests and intellectual property to partners; and to providecomprehensive, leading- edge contract services to companies andresearch institutions around the globe. The Company was foundedin 1996 and is headquartered in Reykjavik, Iceland.

deCODE's balance sheet at June 30, 2009, showed total assets ofUS$69.85 million and total liabilities of US$313.92 million,resulting in a stockholders' deficit of US$244.07 million.

The Company filed for Chapter 11 on November 16, 2009 (Bankr. D.Del. Case No. 09-14063). The petition listed assets ofUS$69.9 million against debt of US$314 million. Liabilitiesinclude US$230 million on 3.5 percent senior convertible notes.

DOLLAR THRIFTY: Expects EBITDA Hike to $83MM to $88M in 2009------------------------------------------------------------Dollar Thrifty Automotive Group, Inc., provided an update on itsoutlook for the fourth quarter and full year of 2009. The Companyannounced that it expects fourth quarter Corporate Adjusted EBITDAto be within a range of $10 million to $15 million, upsignificantly from a loss of $43.4 million in the comparablequarter of 2008. Based on these expected results, the Company'sfull year 2009 Corporate Adjusted EBITDA would range from$83 million to $88 million, up from a loss of $2.3 million in2008. The Company confirmed its prior guidance of an 8 to 10percent decline in rental revenues for the full year of 2009compared to 2008.

"Our strategy for 2009 involved a significant number of actions toreturn the Company to profitability while navigating through thesignificant challenges of the current economic downturn. We arevery pleased with how the company has performed during 2009 andthe way the year is ending. We believe the success of the actionstaken in 2009, combined with our recent equity offering, positionthe Company well for 2010 and beyond," said Scott L. Thompson,Chief Executive Officer and President. "We greatly appreciate thesupport that we received in 2009 from our manufacturer partners,our lenders and our employees as we worked to significantly changethe Company's direction and competitive position," said Thompson.

The above data relating to the fourth quarter results arepreliminary estimates based on information available at this time,and will be updated in conjunction with the Company's fourthquarter earnings release.

About Dollar Thrifty Automotive

Dollar Thrifty Automotive Group, Inc. is headquartered in Tulsa,Oklahoma. Driven by the mission "Value Every Time," the Company'sbrands, Dollar Rent A Car and Thrifty Car Rental, serve value-conscious travelers in over 70 countries. Dollar and Thrifty haveover 600 corporate and franchised locations in the United Statesand Canada, operating in virtually all of the top U.S. andCanadian airport markets. The Company's approximately 6,400employees are located mainly in North America, but global servicecapabilities exist through an expanding international franchisenetwork.

In November 2009, Standard & Poor's Ratings Services raised itscorporate credit rating of Dollar Thrifty to 'B-' from 'CCC', inlight of the Company's improved operating and financialperformance that began in mid-2009. Moody's Investors Servicealso upgraded Dollar Thrifty's Probability of Default Rating to'B3' from 'Caa2' and Corporate Family Rating to 'B3' from 'Caa3'.

EDGE PETROLEUM: Objections to Ch. 11 Plan Pile Up-------------------------------------------------Law360 reports that the trustee overseeing Edge Petroleum Corp.'sprepackaged Chapter 11 case and the Texas Comptroller of PublicAccounts have filed objections to the energy company's proposedplan, alleging that it gives too much weight to Company insidersand fails to account for certain tax claims.

Edge Petroleum will present the plan for confirmation and theresults of an auction for all assets on December 11.

The reorganization plan is built upon the sale of the Company'sassets. The Chapter 11 plan and sale are supported by the holdersof at least two-thirds of the $227.5 million debt under thesecured credit agreement, according to Edge. The disclosurestatement says the secured lenders are to receive almost allproceeds from the sale and Edge's cash. The lenders are to make a$350,000 "gift" to be shared by unsecured creditors. In addition,unsecured creditors can receive collections from preference suits.The "gift" and lawsuit collections may be used also to payexpenses of the Chapter 11 case.

Edge Petroleum received the Bankruptcy Court's approval to auctionoff its assets on December 7. It has signed a certain Purchaseand Sale Agreement dated September 30, 2009 with PGP Gas SupplyPool No. 3, who will purchase the assets for $191 million absenthigher and better bids at the auction.

About Edge Petroleum

Edge Petroleum Corporation (Nasdaq:EPEX) (Nasdaq:EPEXP) is aHouston-based independent energy company that focuses itsexploration, production and marketing activities in selectedonshore basins of the United States.

At September 30, 2009, the Company had total assets of$247.5 million, total liabilities of $244.2 million, and astockholders' deficit of $3.3 million.

EDGEN MURRAY: Moody's Assigns 'Caa1' Rating on $465 Mil. Notes--------------------------------------------------------------Moody's Investors Service assigned a Caa1 rating to Edgen MurrayCorporation's proposed offering of $465 million of senior securednotes due 2016 and affirmed the company's other ratings. Whilethe business outlook for the company is expected to be challengingover the next year, Moody's changed Edgen Murray's rating outlookto stable from negative due to the fact that the proposed noteoffering will eliminate the company's most stringent debtcovenants and, therefore, improve its financial flexibility as itnavigates through a period of weakness in the energy andconstruction markets. Net proceeds of the proposed note offering,along with cash on hand, will be used to repay the company's firstlien and second lien term loans.

Edgen Murray's B3 corporate family rating reflects its highleverage, exposure to highly cyclical end markets, relativelysmall size, negligible tangible assets, and decliningprofitability as energy-related investments slow. Moody's expectproject and maintenance spending in the energy industry willremain weak for much of 2010. Furthermore, intense competitionfor new orders is likely to keep the company's operating marginlow even after oil and gas drilling and capital budgets recover.Edgen Murray's rating is supported by the company's globalpresence, solid position in niche markets within the oil and gasindustry, and the countercyclical nature of its working capitalinvestment, which results in cash inflows when demand falls.

Prospective for the senior secured note offering, the stablerating outlook reflects Edgen Murray's adequate liquidity over thenext 12 to 18 months and Moody's expectation that oil and gasactivity levels and spending for energy projects will begin topick up in the second half of 2010, providing a degree of reliefto the company's otherwise weak debt protection measures.

-- Caa1 for the first lien term loan due 2014 -- Caa1 for the second lien term loan due 2015

The term loan ratings will be withdrawn at the conclusion of thefinancing.

Moody's last rating action for Edgen Murray was on September 29,2009, when its ratings were downgraded by one notch, and theoutlook was changed to negative from stable. Edgen Murray'sratings have been assigned by evaluating factors that Moody'sbelieves are relevant to the company's risk profile, such as thecompany's (i) business risk and competitive position compared withothers within the industry; (ii) capital structure and financialrisk; (iii) projected performance over the near to intermediateterm; and (iv) management's track record and tolerance for risk.These attributes were compared against other issuers both withinand outside Edgen Murray's core industry; Edgen Murray's ratingsare believed to be comparable to those of other issuers withsimilar credit risk.

Edgen Murray, headquartered in Baton Rouge, Louisiana, is adistributor of carbon steel and alloy products for use primarilyin specialized applications in the energy and niche industrialsegments. The company operates on a global basis, withapproximately one-third of its sales generated outside of theAmericas, and has distribution centers in five countries tofacilitate timely deliveries to companies and contractors engagedin the development of new energy infrastructure projects and themaintenance of existing facilities. In the twelve months endedSeptember 30, 2009, Edgen Murray had sales of $968 million. Thecompany is owned by Jefferies Capital Partners, certain co-investors and members of senior management.

ENRON CORP: Richardson Stoops Want Ruling on Injunction Claim-------------------------------------------------------------Richardson, Stoops, Richardson & Ward asks the U.S. District Courtfor the Southern District of Texas to grant a summary judgmentagainst The Regents of the University of California on itspermanent injunction claim because law does not recognize the typeof absolute immunity that must exist to garner that broad relief.

To recall, the Regents plead that it is entitled to garner for itslawyers broad-sweeping, permanent injunctive relief under the AllWrits Act based on the narrow exceptions found in the Anti-Injunction Act.

Richardson Stoops asserts that the All Writs Act provides thatfederal courts "may issue all writs necessary or appropriate inaid of their respective jurisdiction and agreeable to the usagesand principles of law." However, Richardson Stoops notes, theAnti-Injunction Act serves as a check on the authority recognizedby the All Writs Act. Richardson Stoop relates that under theAnti-Injunction Act, an injunction halting a state courtproceeding is inappropriate, except where one of three exceptionsis met:

(b) The anti-suit injunction is necessary in aid of a federal court's jurisdiction; or

(c) An anti-suit injunction must issue to protect or effectuate a federal court's judgments.

Raul H. Suazo, Esq., at Martin, Disiere, Jefferson & Wisdom, LLP,in Houston, Texas, avers that the injunction proceedings are nolonger about temporarily delaying Richardson Stoops' right toproceed against the California Defendants; rather, it is aboutpermanently depriving Richardson Stoops of its right to a jurytrial to supposedly protect a case that is coming to an end.According to Mr. Suazo, a permanent injunction will immunizetortfeasors and actually encourage larger law firms to breachagreements or perpetrate wrongs against smaller law firms who willhave no ability to present those wrongs to a jury.

"Given the criminal convictions and disbarments associated withthe California Defendants, it is obvious that law firms engaged insecurities fraud classes should not be given such broadprotections that are actually disallowed by binding United StatesSupreme Court and Fifth Circuit authority," Mr. Suazo asserts.

In a separate filing, Richardson Stoops seeks the Court'sauthority to take a deposition of Christopher Patti, in-housecounsel for The Regents of the University of California, regardingThe Regents' pending motion to obtain a permanent injunctionagainst Richardson Stoops.

According to The Regents, Richardson Stoops' deposition noticerequests discovery from the same client it allegedly served by itspurported work on the Newby Case in violation of Basic Principlesof Professional Responsibility. The Regents adds that anydiscovery Richardson Stoops might seek via an oral deposition ofMr. Patti is irrelevant to whether the Court should grant apermanent injunction against Richardson Stoops.

Accordingly, if the Court were to allow Mr. Patti's deposition toproceed, The Regents request an appropriate protective order that:

(a) bars any inquiry concerning The Regents' privileged communications with any of its counsel;

(b) prohibits any inquiry concerning The Regents' work product strategy to address Richardson Stoops' lawsuit or any similar lawsuit; and

(c) requires the deposition be taken in California, where Mr. Patti resides and works.

The Regents Respond

In reply to the Motion, the Regents ask the District Court to denyRichardson Stoops' Motion for Summary Judgment arguing that themotion takes a new tack on the firm's strategy of trying to recastits California state court lawsuit as something other than anattempt to relitigate the Newby fee award. The Regents add thatRichardson Stoops' new tack is to deflect attention from therealities of its state court lawsuit by attacking The Regents as"savvy institutional investors trying to block a modestly sizedlaw firm from litigating its intentional tort claim" when "thereis truly nothing at stake" for The Regents.

Moreover, The Regents aver that none of the arguments inRichardson Stoops' Motion for Summary Judgment are new.

In a subsequent filing, the Regents tell the Court that inaccordance with its settlement with Richardson Stoops and as aresult of the dismissal of Richardson Stoops' California lawsuit,it is withdrawing all of its pending applications and supplementalapplications for permanent injunctive relief and Motion to Quash.In addition, the Regents ask the Court to dissolve the preliminaryinjunction issued against Richardson Stoops.

Richardson Stoops asserts that the Regents are required toparticularize their assertion of the attorney-client or workproduct privilege and prove their case with respect to eachspecific document or communication allegedly falling within therealm of these privileges as to allow Richardson Stoops and theCourt to assess the assertion. Thus, Richardson Stoops asks theCourt to direct The Regents to respond to its interrogatories,request for production, and request for admissions.

The Debtors filed their Chapter Plan and Disclosure Statement onJuly 11, 2003. On January 9, 2004, they filed their fifth AmendedPlan and on the same day the Court approved the adequacy of theDisclosure Statement. On July 15, 2004, the Court confirmed theDebtors' Modified Fifth Amended Plan and that plan was declaredeffective on November 17, 2004.

After the approval of the Plan, the new board of directors decidedto change the name of Enron Corp. to Enron Creditors RecoveryCorp. to reflect the current corporate purpose. ECRC's solemission is to reorganize and liquidate certain of the operationsand assets of the "pre-bankruptcy" Enron for the benefit ofcreditors.

ECRC has been involved in the MegaClaims Litigation, an actionagainst 11 major banks and financial institutions that ECRCbelieves contributed to Enron's collapse; the Commercial PaperLitigation, an action involving the recovery of payments made tocommercial paper dealers; and the Equity Transactions Litigation,which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG,Credit Suisse and Bear Stearns to recover payments made to thefour banks on transactions involving Enron's stock while thecompany was insolvent.

ENRON CORP: Savings Plan Can Recover Error Payments---------------------------------------------------Judge Melinda Harmon of the U.S. District Court for the SouthernDistrict of Texas has ordered that Enron Corp. Savings Plan isentitled to recover from EOG Resources, Inc., Savings Plan thefull amount of the Title allocation overpayments that EOG SavingsPlan received in error.

The Debtors filed their Chapter Plan and Disclosure Statement onJuly 11, 2003. On January 9, 2004, they filed their fifth AmendedPlan and on the same day the Court approved the adequacy of theDisclosure Statement. On July 15, 2004, the Court confirmed theDebtors' Modified Fifth Amended Plan and that plan was declaredeffective on November 17, 2004.

After the approval of the Plan, the new board of directors decidedto change the name of Enron Corp. to Enron Creditors RecoveryCorp. to reflect the current corporate purpose. ECRC's solemission is to reorganize and liquidate certain of the operationsand assets of the "pre-bankruptcy" Enron for the benefit ofcreditors.

ECRC has been involved in the MegaClaims Litigation, an actionagainst 11 major banks and financial institutions that ECRCbelieves contributed to Enron's collapse; the Commercial PaperLitigation, an action involving the recovery of payments made tocommercial paper dealers; and the Equity Transactions Litigation,which ECRC filed against Lehman Brothers Holdings, Inc., UBS AG,Credit Suisse and Bear Stearns to recover payments made to thefour banks on transactions involving Enron's stock while thecompany was insolvent.

ERIC N REYBURN: Court Sets January 25 as Claims Bar Date--------------------------------------------------------The Hon. Frank J. Bailey of the U.S. Bankruptcy Court for theDistrict of Massachusetts has established 4:30 p.m. on January 25,2010, as the deadline for individuals and entities to file proofsof claim against Eric N. Reyburn.

Any individual or entity asserting a claim must file a proof ofclaim with the Clerk's office, U.S. Bankruptcy Court for theDistrict of Massachusetts, John W. McCormack Post Office and CourtHouse, 5 Post Office Square, Suite 1150, Boston, Massachusetts.

Gerald C. Bender, Esq., at O'Melveny & Myers LLP, in New York,relates that the Debtor requires legal representation in mattersinvolving the laws and regulations promulgated by the U.S.Customs Service and its successor, U.S. Customs & BorderProtection, in order to effectively contest a proposed actionagainst the Debtor by U.S. Customs.

Mr. Bender says that the Debtor is subject to a proposed customsassessment in an amount exceeding $10.8 million in additionalduties, excluding any interest or penalties, with respect to adispute with U.S. Customs concerning the Debtor's declaration ofthe dutiable value of certain goods that it imported into theUnited States based on the "first sale" or middleman prices ofthose goods that the Debtor purchased from its parent, Escada AG.

According to Mr. Bender, Follick has provided legal services tothe Debtor since May 1992 in matters concerning U.S. Customs, andhas particularly been representing the Debtor with respect tocontesting the proposed assessment in the Customs Dispute.Currently, the firm has an internal advice ruling request pendingbefore the U.S. Customs Headquarters office in Washington, D.C.,as well as a formal protest and application for further reviewpending at the port level. Thus, Follick is familiar with theCustoms Dispute and the Debtor's customs matters generally, Mr.Bender notes. The firm is therefore ideally positioned to advisethe Debtor on the Customs Matters in its Chapter 11 case, heavers.

"The retention of the firm as special customs counsel willcontribute greatly to the efficient administration of theDebtor's estate and the realization of the Debtor's objective ofmaximizing the value of its bankruptcy estate," Mr. Benderemphasizes.

The Debtor will pay the Follick professionals based on thesehourly rates:

The Debtor also intends to reimburse Follick for the firm'snecessary out-of-pocket expenses. The firm did not receive aretainer in connection with the proposed retention, according toMr. Bender.

John A. Bessich, Esq., sole shareholder at Follick, informed theCourt that the Debtor owes his firm $7,521 for prepetitionservices. During the 90-day period preceding the Petition Date,Follick received payments for fees and expenses from the Debtortotaling $49,120. As of the Petition Date, Follick performedlegal services for the Debtor and incurred expenses in the totalunbilled amount of $17,037, Mr. Bessich adds.

Mr. Bessich assures the Court that Follick does not a representor hold any interest adverse to the Debtor or its estate.

About Escada AG

The ESCADA Group -- http://www.escada.com/-- is an international fashion group for women's apparel and accessories, which is activeon the international luxury goods market. It has pursued a courseof steady expansion since its founding in 1976 by Margaretha andWolfgang Ley and today has 182 own shops and 225 franchiseshops/corners in more than 60 countries.

As of August 10, 2009, the Escada Group operated 176 owned storesand so-called shop in shops, of which 26 owned stores are locatedin the United States and operated by Escada (USA) Inc. and 2stores are planned to be opened in the United States before yearend. Escada Group products are also sold in 163 stores worldwidewhich are operated by franchisees. Escada Group had total assetsof EUR322.2 million against total liabilities of 338.9 million asof April 30, 2009.

The Debtor seeks to retain PwC because of the firm's extensiveexperience and qualifications in providing audit services in andout of bankruptcy. Furthermore, PwC is already very familiarwith the Debtor's operations due to services it provided to theDebtor prior to the Petition Date, Gerald C. Bender, Esq., atO'Melveny & Myers LLP, in New York, relates. Specifically, thefirm has performed annual audits of the Debtor's financialstatements in the past and has obtained intimate knowledge of theDebtor's accounting policies and internal financial controls.

Pursuant to the terms and conditions of the parties' EngagementLetter, the Debtor seeks to retain PwC to:

(1) audit the financial statements of the Company at October 31, 2009, and for the year then ending; and

(2) audit the International Accounting Standards Consolidation Questionnaire of Escada AG at October 31, 2009, and for the year then ending.

The Debtor and PwC have agreed that the Audit Services will beprovided based on a "fixed fee" structure, whereby the Debtorwill pay PwC an estimated fee of $235,000. In the eventadditional fees are required as a result of the Debtor's failureto meet any of the requests contained in the agreement or theDebtor seeking non-routine services from PwC, PwC will inform theDebtor and provide estimates to the Debtor's management.

The Debtor intends to pay for PwC's services based on thesehourly rates:

The Debtor also intends to reimburse PwC for the firm'sreasonable and necessary out-of-pocket expenses.

Anthony S. Passaretti, Esq., a partner at PwC, discloses thatduring the 90-day period before the Petition Date, the Debtorpaid PwC $188,690. As of the Petition Date, the Debtor owes PwC$95,553 for prepetition services.

Upon approval of PwC's retention in the Debtor's Chapter 11 case,PwC will waive its right to receive any unpaid fees incurredprior to the Petition Date by the Debtor, Mr. Passaretticlarifies.

Mr. Passaretti assures Judge Bernstein that PwC is a"disinterested person" as that term is defined under Section101(14) of the Bankruptcy Code, as modified by Section 1107(b).

About Escada AG

The ESCADA Group -- http://www.escada.com/-- is an international fashion group for women's apparel and accessories, which is activeon the international luxury goods market. It has pursued a courseof steady expansion since its founding in 1976 by Margaretha andWolfgang Ley and today has 182 own shops and 225 franchiseshops/corners in more than 60 countries.

As of August 10, 2009, the Escada Group operated 176 owned storesand so-called shop in shops, of which 26 owned stores are locatedin the United States and operated by Escada (USA) Inc. and 2stores are planned to be opened in the United States before yearend. Escada Group products are also sold in 163 stores worldwidewhich are operated by franchisees. Escada Group had total assetsof EUR322.2 million against total liabilities of 338.9 million asof April 30, 2009.

The petition was signed by P.L. Fekany, president/director of theCompany.

FLOWSERVE: Fitch Says Rating Trends Stable------------------------------------------According to Fitch Ratings, the number of negative rating actionsfor the U.S. Diversified Industrials sector is likely to be muchlower in 2010 than in 2009 as rating trends are expected tostabilize. A return to economic growth across many regions, thegradual completion of restructuring and downsizing programs, focusby issuers on stronger balance sheets, and a more stable operatingenvironment compared to the early phase of the global recessionwill all contribute to more stability next year. The pace ofratings downgrades in the broader U.S. corporate bond marketslowed materially in the third quarter of 2009, which would beconsistent with expectations for a slowly improving global economyand better performance by most companies in the diversifiedindustrial sector.

'Currently, Negative Rating Outlooks among diversified companiesrated by Fitch significantly outnumber Positive Outlooks, but asissuers repair their credit profiles, Negative Outlooks could berevised to Stable and upgrades could increase,' said Eric Ause,Senior Director at Fitch. 'Positive rating actions would beexpected to occur late in the credit cycle, possibly after 2010 asa return to stronger credit metrics may be slower than usual,which reflects the severity of the recent recession, simultaneousstresses in the credit markets that have pressured liquidity, andthe potentially anemic pace of an economic rebound.'

Issuers Expected to Rebuild Balance Sheets in 2010:

Entering 2010, leverage is at relatively high levels for manydiversified companies. Higher-than-normal leverage is not unusualat this stage of the credit cycle and is due largely to loweroperating results. When operating results eventually improve,leverage can also be expected to improve. However, the recoveryis anticipated to be slow which could hinder a return to lowerleverage. This concern is partly mitigated by a trend towardsmanaging balance sheets more conservatively in response todifficult capital markets and the evident value of liquidity.Several diversified companies issued meaningful amounts of equityin the first nine months of 2009 (GE, JCI, KMT, TXT), notincluding ETN which issued equity in 2008, and two issuers (GE,TXT) cut their dividends. Acquisition activity has been quiet butcould increase in 2010, reflecting recent increases in valuations.

Rebound in Operating Performance Expected to be Slow:

Sales in 2010 for U.S. diversified companies are expected toimprove slowly from trough levels reported during 2009, but therecovery from the recent recession could be fitful. Fitchanticipates that a full recovery will not occur until late-cyclesectors of the economy begin to revive, possibly as late as 2011.Underpinning Fitch's Diversified outlook is the firm's most recentglobal economic outlook, which as of October 2009 calls for globalGDP to shrink 2.8% in 2009, the first time annual growth has beennegative since WWII, followed by expected global growth recoveryto 2% in 2010 and 2.7% in 2011. In the major advanced economies(MAEs) where diversified companies still conduct the bulk of theirbusiness, GDP is forecast to decline 3.7% in 2009 and return to atepid growth rate of 1.2% in 2010. Fitch expects GDP to grow 6.5%in the BRIC countries (Brazil, Russia, India, China) in 2010.Although global GDP looks set to return to positive growth, theabsolute level of GDP is low, and it is possible that in the U.S.GDP may not return to the 2008 level until 2011.

Mixed Revenue Outlook:

Diversified companies typically are composed of a mix of early-,mid- and late-cycle businesses. They also sell into diversegeographic end-markets. As a result, the pace at which salesrecover will vary by issuer depending on each issuer's customerbase. On a sequential basis, demand generally stopped falling bythe third quarter of 2009. In many late-cycle markets, ordershave stopped falling, although actual sales could decline foranother quarter or two. Most issuers remain cautious aboutpredicting the strength and timing of a rebound in sales. Normaleconomic signals are obscured by several factors: 1) inventorydestocking earlier in 2009, followed by re-stocking which wouldrepresent a non-recurring boost to sales, 2) the U.S. cash-for-clunkers program that accelerated the replacement of oldervehicles in the automotive sector, and 3) stimulus spending inChina and cash-for-clunkers programs in Europe.

Late-cycle businesses such as non-residential construction willremain weak well into 2010, offsetting improvements in early cyclebusinesses. In the aerospace sector, Fitch expects largecommercial aircraft deliveries by Boeing and Airbus to declineapproximately 5% (excluding potential 787 deliveries) from 2009,but there is a risk of additional production cuts, especially in2011. However, high backlogs at Boeing and Airbus should bufferthe expected decline. The aerospace aftermarket could show someimprovement in late 2010 after declining sharply in 2009 due to areduction in the number of flights and the cannibalization ofparked planes by the airlines. Business jet deliveries appearlikely to decline further in 2010 following a very weak year in2009. Fitch expects business jet deliveries for all of 2009 tofall 35-40% from a cyclical peak in 2008, and a peak to troughdecline of 50% would not be unrealistic. Diversified companieswith material exposure to aerospace include GE, ETN, HON, TXT andUTX.

Non-residential construction is expected to fall 12% in 2010following a 16% decline in 2009 according to the AmericanInstitute of Architects' most recent Consensus ConstructionForecast. It is possible that conditions could be weak wellbeyond 2010, depending on trends in vacancy rates and theavailability of financing. Most diversified companies have someexposure to non-residential construction through electricalproducts (CBE, HUBB, ETN, TNB), controls and systems (HON, JCI),elevators (UTX), scaffolding (HSC) and a wide variety of otherproducts and services. Some non-residential markets will benefitfrom expected spending related to stimulus and energy conservationprojects, particularly institutional buildings for which theoutlook is not as negative as it is for office, retail andindustrial buildings.

The U.S. market is expected to fare worse than other regionsaround the globe. Europe is also weak. Developing markets havelargely performed better than developed markets and should returnto normal growth more quickly. As the U.S. represents a largeshare of total non-residential construction, a protracted downturnin non-residential construction will temper the impact ofimproving results in other parts of the economy. Residentialconstruction also is a significant market for diversifiedcompanies. The sector has shrunk so much over the past few yearsthat there is not much downside risk. On the other hand, it isnot clear how quickly the sector will recover given the largeinventory of homes, a lack of liquidity affecting privatefinancing, and declining valuations that leave many homeownerswith negative equity.

The outlook is more positive for shorter-cycle, consumptionoriented businesses (services and parts) that should benefit froma resumption of stable economic activity. However, absolute saleslevels are currently low and growth seems likely to be tepid asthere are few end-markets where strong demand is expected. Salesgrowth could vary across sectors depending on their location inthe capital investment chain. Sales of longer-lived parts andequipment may only recover gradually as existing productioncapacity and equipment is brought to full capacity or used up.Exceptions include certain energy and infrastructure markets.These markets are less directly tied to economic cycles than tolong-term demand for energy and to demographic trends that affectpublic funding for water and transportation projects.

Margins to Benefit from Cost Controls and Stabilizing Sales:

During 2010 diversified companies can be expected to rebuildmargins as they complete restructuring efforts and align costswith lower sales levels. Margin performance has varied widely in2009. Some companies (UTX, TNB, FLS) reacted early or were ableto take advantage of a variable cost structure to limit margindeclines. In other cases, orders and sales dropped sharply,particularly in short-cycle businesses, contributing to temporaryquarterly losses (KMT, ETN, JCI). Profitability typically wasrestored by the third quarter of 2009 when sales stopped fallingat the rapid pace that occurred in the first half of the year.Although conditions should be more stable in 2010 than during2009, demand remains weak and diversified companies will bechallenged to balance the risk of excess capacity with thepossible loss of market share when demand eventually improves. Inlate-cycle businesses, margins could remain under pressure wellinto 2010 until the recession runs its course. This concern ismitigated by a long order cycle, relative to short-cyclebusinesses, that helps smooth out production and reduce salesvolatility. Cancellations by customers remain a risk, however, asdoes the availability of financing that often is an importantfactor in long-cycle projects. Government stimulus spending maylimit these risks depending on where and when it is used.

Other items could also affect margins in 2010. Raw material costshave fallen dramatically since peaking in 2008. However, somecosts, such as oil and copper, have subsequently rebounded,highlighting volatility as an ongoing risk. In the near term, aweak economy can be expected to keep raw material costs atmoderate levels. Pricing represents another risk. To date therehas been limited pricing pressure, but it could increase as oldcontracts run off and as diversified companies and their customerscontinue to adjust to a period of low demand. Finally, pensionexpense could increase depending on market conditions. Any cashimpact on pension contributions would appear to become moresignificant after 2010.

Restructuring to Wind Down Gradually:

As restructuring is gradually completed, margins in 2010 will besupported by lower costs and the absence of restructuring charges.Any increases in volume would also support margins through betterabsorption. Margins in 2010 may not increase to levels seen priorto the recession, but they should improve on a sequential basiscompared to cyclical lows, many of which occurred in the secondquarter of 2009. Steep sales declines in the first half of 2009depressed operating margins, sometimes causing losses in certainbusinesses as capacity couldn't be reduced quickly enough tooffset lower volumes.

Temporary cost reductions were initiated by a large number ofdiversified companies during 2009 to protect profits and preserveliquidity. Their eventual reversal could partly negate thepositive impact of restructuring. Some temporary cost reductionshave already been reversed, but others remain in place and may notbe reversed until economic conditions improve further. Temporarycuts included furloughs and reductions to compensation such asbonuses and 401(k) plans.

Free Cash Flow Could Decline Modestly:

Fitch anticipates that cash from operating activities in the nearterm may be only slightly lower than historical levels, relativeto income. As explained above, aggressive restructuring hasenabled many diversified companies to limit margin declines tomodest levels. Working capital reductions have supported cashflow during 2009 as sales have fallen. Sales growth in 2010 couldreverse this trend and require cash to be invested in workingcapital, but amounts likely would not be large given expectationsfor slow economic growth.

Pension liabilities continue to be a concern. Although assetreturns in 2009 have been favorable, interest rates remain low andmay negate a portion of asset returns when net pension liabilitiesare calculated at the end of 2009. In many cases, requiredpension contributions in 2010 may remain low, but they couldincrease in subsequent years unless further strong asset returnsand/or an increase in the discount rate help to reduce net pensionliabilities.

Fitch does not expect capital expenditures to increasesubstantially in 2010 compared to reduced levels in 2009. Theprimary driver is the lack of investment opportunities related toslow growth, although some issuers in 2009 reduced capitalspending in an effort to preserve liquidity in the face ofdifficult conditions in the debt markets. As with workingcapital, any benefit to free cash flow would likely be reversedonce sales improve and companies look to take advantage ofinternal growth opportunities.

Uncertain Impact of Discretionary Expenditures:

Acquisitions may become more common in 2010 as visibility intoend-market demand improves further. Most diversified companiescontinue to maintain a list of potential acquisitions and couldact quickly. Acquisition activity was relatively low in 2009 dueto a focus by some issuers on preserving liquidity, the relatedissue of limited availability or high cost of financing, theunwillingness of sellers to accept low prices, and a priority onrestructuring existing operations.

Share repurchases could increase in 2010 but are not likely, inFitch's view, to be nearly as substantial as in previous years.Issuers are focused on maintaining a strong balance sheet tooffset the impact of weaker earnings, a lack of confidence in theavailability of financing, and uncertainty about the economy.Even UTX and SPW, which are among the more consistent companieswith respect to discretionary cash deployment, have scaled backshare repurchases until conditions improve.

Liquidity and Financing Expected to be Manageable:

Disruptions in the capital markets during the past two years havefaded but could have a long tail. Government support played amajor role in stabilizing the capital markets and it continues tobe important. Despite investor confidence that contributed tostrong market returns during 2009, it is unclear to what degreethe capital markets still depend on government support or howquickly government support will be phased out. Diversifiedcompanies sell into end-markets where financing may be needed tofund projects or large equipment. If the availability offinancing continues to be problematic for customers of diversifiedcompanies, future sales could be negatively affected.

Among the diversified companies rated by Fitch, financingcontinues to be available and liquidity concerns have beenaddressed successfully. The only exception was TXT's drawdown ofits bank facilities in February 2009 as a defensive action toprotect its liquidity while it proceeds with the wind-down of non-captive financing at Textron Financial. Even so, TXT wassubsequently able to issue debt and equity. Although issuers areable to access the capital markets, there are concerns aboutmarket reliability.

Issuers are likely to be less sensitive to conditions in thecommercial paper market in 2010 than during the past one to two,largely because they have taken a more cautious approach tomanaging their balance sheets in response to the previous capitalmarket disruptions. A number of issuers paid down commercialpaper balances with proceeds from long-term debt or equity, whileothers paid down commercial paper as a way to reduce total debtand control leverage. Due to continuing uncertainty surroundingthe capital markets, issuers could continue to look foropportunities to issue debt in 2010 while interest rates arefavorable.

Bank financing has become more restrictive, most notably whenissuers look to renew revolving credit facilities that typicallyrepresent an important source of liquidity. Previous marketlosses and growing delinquencies that normally accompanyrecessions have pressured bank to improve their capitalization andreduce their risk exposure. As a result, banks are offering lessfavorable terms. In most cases, revolving credits are beingrenewed at lower amounts, shorter terms and higher pricing. Ifsuch terms don't eventually return toward previous levels, issuersmay consider increasing their reliance on long-term debt and othersources of financing.

Strategic Implications:

The impact of the recession on credit metrics for certain issuers(ETN, JCI, TXT) has been exacerbated by a variety of factors suchas acquisitions, end-market exposure, or strategic actions.Depending on the path of the economic recovery, more time thanusual may be needed to return credit metrics to normal levels atthese and other issuers similarly affected. Debt reduction can beexpected to be a priority. However, a long-term risk is thepossibility that it may be difficult to regain stronger creditmetrics while at the same time funding strategically importantactivities such as acquisitions. As a result, there potentiallycould be a trade-off, at least in the short run, betweenprofitability and competitiveness on one hand and, on the otherhand, a strong balance sheet and financial flexibility.

Issuers in the Diversified Industrial Sector:

Fitch-rated issuers and their current Issuer Default Ratings inthe U.S. diversified industrial sector:

FONTAINEBLEAU LV: Judge Disallows Credit Bid for 63-Story Project-----------------------------------------------------------------U.S. Bankruptcy Judge A. Jay Cristol has entered an opiniondenying the holders of mechanics liens an opportunity to offer acredit bid -- instead of cash -- at a January 21 auction forFontainebleau Las Vegas Holdings LLC's uncompleted 63-storyproject on the north end of the Las Vegas Strip. Judge Cristolsaid in his three-page opinion that the amount, validity andpriority of the mechanics' lien claims are in doubt. Giveninsufficient time before the auction, Judge Cristol deniedmechanics' lienholders the right to credit bid.

Judge Cristol also said it wasn't feasible to allow even thefirst-lien creditors to credit bid in an auction against cashbidders. The Judge notes that not all secured lenders wouldcredit bid even if they had the ability.

At the Jan. 21 auction, the stalking horse bid of $156.5 millionfor the entire project will come from a company affiliated withCarl Icahn. The offer includes the assumption of $50 million infinancing for the Chapter 11 case. Penn National Gaming Inc. wasoriginally the lead bidder before it was replaced by the Icahnentity. Penn Treaty may still bid at the auction.

As of June 9, 2009, Fontainebleau Las Vegas LLC listed more than$1 billion in debt and a similar amount in assets, while each ofFontainebleau Las Vegas Capital Corp. and Fontainebleau Las VegasHoldings, LLC, listed less than $50,000 in assets and more than$1 billion in debts.

According to the schedules, the Company has assets of $2,673,244,and total debts of $4,776,913.

The Debtor did not file a list of its 20 largest unsecuredcreditors when it filed its petition.

The petition was signed by Stephen Ingrassia, managing member ofthe Company.

FRIEDE GOLDMAN: Claim Litigation Didn't Waive Arbitration Right---------------------------------------------------------------WestLaw reports that a creditor that had entered into aprepetition contract with the Chapter 11 debtor for constructionof a ship did not waive its contractual right to arbitration on aclaim arising from the debtor's alleged negligent design andconstruction of the vessel when, to protect its rights followingcommencement of the debtor's bankruptcy case, it filed a proof ofclaim prior to expiration of the claims deadline, responded to aclaim objection, and apparently participated in some amount ofdiscovery. The creditor, less than one month after filing itsproof of claim, requested relief from the automatic stay tocomplete arbitration and clearly put the liquidating trusteeappointed under the debtor's confirmed plan on notice that itwould exercise its arbitration rights. The liquidating trusteemade no showing of any prejudice or unfairness by virtue of anydelay, expenses or damage to its position. In re The ConsolidatedFGH Liquidating Trust, --- B.R. ----, 2009 WL 3756921 (Bankr. S.D.Miss.).

GENERATION BRANDS: Court Sets Jan. 15 Confirmation Hearing----------------------------------------------------------Bill Rochelle at Bloomberg reports that the Bankruptcy Court willconvene a hearing on January 15 to consider (i) confirmation ofthe proposed prepackaged Chapter 11 plan of Generation Brands LLCand Quality Home Brands Holdings LLC and (ii) the disclosurestatement and solicitation materials were adequate. The Debtorsobtained the required votes for the Plan prior to the bankruptcyfiling on December 4.

The Plan will reduce debt by $150 million while giving 91.75% ofthe new stock to holders of $101 million in second-lien debt. Thefirst-lien obligations are to be restructured as a cash-paying$125.6 million secured debt and a $105.5 million term loan payinginterest with more notes. Unsecured creditors are to receive 7.5%of the new stock. The bankruptcy judge is allowing the company topay trade suppliers in full even before the plan is confirmed.The Plan will be financed in part by $20 million in new preferredstock being purchased by the principal shareholder, Quad-CManagement Inc.

The bankruptcy judge set up a hearing on Dec. 23 for approval of$20 million in debtor-in-possession financing from existinglenders.

In addition to the second-lien debt where Bank of New York servesas agent, liabilities include $239 million on a first-lienrevolving credit and term loan with BNP Paribas as agent. Thecompany also owes $54.7 million on 14.5 percent unsecured notesowing to Apollo Investment Corp.

About Generation Brands

Generation Brands is one of America's leading companies servingthe lighting, electrical wholesale, home improvement, home decor,and building industries. The company has an outstanding portfolioof fashionable and functional lighting fixtures, ceiling fans, anddecorative products that provide value and growth for itscustomers and end-users.

The Company was advised in connection with its pre-packagedChapter 11 financial reorganization by White & Case LLP andBarclays Capital. Generation Brands listed assets of $520 millionand debt of $488 million.

GENERATION BRANDS: Receives Approval of First Day Motions---------------------------------------------------------Generation Brands disclosed that Judge Peter J. Walsh of the U.S.Bankruptcy Court in Wilmington, Delaware, on December 8 approvedthe Company's requests to permit it to continue working with itscustomers, suppliers and employees in the normal course. TheCourt also determined that it will hold a hearing to considerconfirmation of the proposed pre-packaged plan of reorganizationon January 15, 2010. If the plan is approved at the hearing, theCompany expects to emerge from bankruptcy by the end of January.

The Company received Court permission to pay its suppliers in theordinary course of business, including with respect to goods andservices provided before the December 4 Chapter 11 filing. TheCompany also said that it received Court authority to pay pre-petition employee wages and benefits and commissions to salesagents. The Company's various customer programs, includingrebates, discounts and warranties, will continue as they alwayshave.

"We are pleased that the Court approved our first-day motions,ensuring that our customers, employees and suppliers will see nodifference in our daily operations," said President and ChiefExecutive Officer T. Tracy Bilbrough.

The Company said it received interim Court approval to use itscash collateral to fund its operating expenses. As previouslyannounced, the Company received commitments for a $20 milliondebtor-in-possession (DIP) revolving credit facility which willprovide the Company with additional liquidity during its briefrestructuring period. The bankruptcy court will consider approvalof the DIP financing on December 23, 2009.

"With our confirmation hearing set for January 15, 2010, we are ontrack to successfully complete the restructuring of our balancesheet, eliminating more than $150 million of debt, and emerge fromChapter 11 by the end of January," Mr. Bilbrough concluded.

The Company filed its voluntary petitions in the U.S. BankruptcyCourt for the District of Delaware in Wilmington. The Company wasadvised in connection with its pre-packaged Chapter 11 financialreorganization by White & Case LLP and Barclays Capital.

About Generation Brands

Generation Brands is one of America's leading companies servingthe lighting, electrical wholesale, home improvement, home decor,and building industries. The company has an outstanding portfolioof fashionable and functional lighting fixtures, ceiling fans, anddecorative products that provide value and growth for itscustomers and end-users.

The Company was advised in connection with its pre-packagedChapter 11 financial reorganization by White & Case LLP andBarclays Capital.

GENERAL GROWTH: 32 Affiliates Join as Proponents of Ch. 11 Plan---------------------------------------------------------------Thirty-two more debtor affiliates of General Growth Properties,Inc., were added as proponents to the Joint Plan ofReorganization. The additional Plan Proponent Debtors are:

In light of the addition of 32 Debtors as Plan Proponents, theDebtors, on December 8 and 9, 2009, supplemented the DisclosureStatement accompanying the Joint Plan of Reorganization.

The Amended Disclosure Statement disclosed these matters:

(1) Debtor GGP-Tucson Mall L.L.C. is a defendant to a litigation commenced by KLN Partners, LLC, et al. in an Arizona state court. On December 1, 2008, all of the claims were dismissed in the State Court Action except KLN's claims against GGP-Tucson. Discovery was underway at the time the Debtors' Chapter 11 cases were filed and an automatic stay went into effect pursuant to Section 362 of the Bankruptcy Code.

(2) The merger, dissolution or consolidation of about 13 properties by the Subsequent Plan Debtors in conjunction with implementation of the Plan. A chart showing the 13 Properties' reorganization process is available for free at http://bankrupt.com/misc/ggp_13propreorgchart.pdf

(3) There will be no structural changes to the two properties of Subsequent Plan Debtors Champaign Market Place L.L.C.'s and Columbia Mall L.L.C.'s ownership structure upon emergence. A chart showing the two properties' reorganization process is available for free at:

(5) The original coded organization chart, which depicts the current organizational structure of the GGP Group, as well as certain joint ventures in which the GGP Group holds ownership interests, was replaced. A copy of the Chart is available for free at:

The Plan Debtors also presented to the Court on December 7, 2009,financial projections under the Plan.

The Plan Debtors estimate that the total payments required underthe Plan at emergence are $423.2 million. Of the $423.2 million,$315.8 million is associated with the mortgage and mezzanine debtrestructuring, including extension fees, servicer fees andexpenses, catch-up amortization payments, accrued interest, thefunding of certain escrow and other expenses. A further $107.4million is associated with distributions related to prepetitionclaims against the Plan Debtors.

The Plan Debtors, according to Marcia L. Goldstein, Esq., atWeil, Gotshal & Manges LLP, in New York, are expected to fundthese restructuring costs and Plan distributions predominatelyfrom funds generated by the Plan Debtors since the Petition Date,with additional support from excess liquidity of General GrowthProperties Limited Partnership.

In connection with negotiations between the Plan Debtors and theSecured Debt Holders, the Plan Debtors completed in August 2009the preparation of long-term project-level financial projections,which were provided to the Secured Debt Holders and other keyconstituencies in the Debtors' Chapter 11 cases. Ms. Goldsteinsays the project-level projections show that the Plan Debtorswill have cash flow well in excess of the amounts necessary tosatisfy their principal and interest payments under therestructured secured loans and all other cash needs through 2014.However, she notes that the Plan Debtors' cash flow in 2010 isestimated to be $51.6 million less than their cash needs, dueprimarily to the $150 million pay-down of the secured debt on GGPAla Moana L.L.C.'s property as negotiated as part of therestructuring of that entity's property level secured loan. GGPexpects to fund this shortfall out of excess liquidity of GGP LP.The Ala Moana pay-down also can be deferred beyond 2010, shesays.

Ms. Goldstein adds that the consolidated cash forecast for theperiod December 2009 to December 2010 shows that GGP hassufficient cash to fund the Emergence Costs of the Plan Debtorsas well as the estimated $51.6 million shortfall in 2010. On apro forma basis including all estimated Emergence Costs and otherpayments required by the Plan, GGP projects it will have $192.3million in cash available at the end of 2010.

Based in Chicago, Illinois, General Growth Properties, Inc. --http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for,more than 200 regional shopping malls in 44 states, as well asownership in master planned community developments and commercialoffice buildings. The Company's portfolio totals roughly200 million square feet of retail space and includes more than24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. TheCompany's common stock is trading in the pink sheets under thesymbol GGWPQ.

GENERAL GROWTH: Dillard's Inc. Objects to Plan Confirmation-----------------------------------------------------------Dillard's Inc. and its affiliates complain that the Joint Plan ofReorganization of General Growth Properties Inc.'s units impairstheir legal, equitable and contractual rights under theiragreements with the Debtors.

Dillard's asserts that, under those Agreements, the Debtors arerequired to, among others, satisfy all mechanic's liens againstDillard's premises, and indemnify and defend Dillard's fromcertain claims against Dillard's. Moreover, Dillard's notes thatit may have claims against Debtors who are not Plan Debtorsarising out of the Agreements.

In assuming the Agreements, Dillard's asserts that the PlanDebtors cannot pick and choose which contractual provisions theywill perform post-confirmation and which will be overridden byother provisions of the Joint Plan of Reorganization.

Thus, Dillard's asks the Court to deny confirmation of the Planunless the Plan is revised to preserve Dillard's rights.

As reported by the TCR on Dec. 3, 2009, General Growth Propertieshas filed a plan of reorganization and related disclosurestatement. The Plan is associated with roughly $9.7 billion ofsecured mortgage loans, as GGP has reached consensual agreementsin principal with certain secured mortgage lenders. The Planprovides that all undisputed claims against the emerging debtorsfor prepetition goods and services will be paid in full.Confirmation of the plan of reorganization is currently scheduledfor December 15, 2009.

About General Growth

Based in Chicago, Illinois, General Growth Properties, Inc. --http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for,more than 200 regional shopping malls in 44 states, as well asownership in master planned community developments and commercialoffice buildings. The Company's portfolio totals roughly200 million square feet of retail space and includes more than24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. TheCompany's common stock is trading in the pink sheets under thesymbol GGWPQ.

Ms. Goldstein says GGP has maintained its status as a REIT andavoided having to pay entity level income taxes or the Excise Taxby distributing at least 100% of its taxable income to itsshareholders in cash. However, current Internal Revenue Serviceguidance provides that a REIT's distribution of its taxableincome for the purpose of maintaining its REIT status andavoiding entity level income taxes need not be satisfied solelyin cash, she points out.

GGP, by this motion, thus seeks the Court's authority to maintainits REIT status and avoid entity level income taxes and theExcise Tax by declaring and paying a dividend equal to 100% ofits taxable income, which dividend will be paid partially withGGP common stock and partially with cash.

Stockholders, Ms. Goldstein says, will be given an election toreceive their dividend in either cash or common stock, subject toa 10% cap on the aggregate portion of the dividend to be paid incash. GGP estimates its 2009 dividend obligation to be $101million, of which $90.9 million will be paid in stock and $10.1million in cash. Ms. Goldstein reiterates that the figure is acurrent estimate, and the Debtors are working diligently toprepare final numbers. She says it is possible that the amountscited, including the Excise Tax, could vary by as much as 20-30%.

Specifically, the Debtors seek the Court's authority:

(i) to declare and make the dividends and distributions for the 2009 fiscal year to enable GGP to maintain its qualification as a REIT and to avoid payment of entity level income taxes and an Excise Tax; and

(ii) for their directors and officers, as applicable, to take necessary steps to implement and effectuate the declaration and payment of the Dividend.

Ms. Goldstein points out that the Debtors' business model, andthe enterprise's attractiveness to all stakeholders on a going-forward basis, is predicated on GGP retaining its REITqualification and avoiding entity level taxation. However, GGP'sfailure to satisfy its REIT-related dividend obligations byDecember 21, 2009, would cause it to incur an Excise Tax for$3,434,000, she says. GGP would then be obligated to pay theExcise Tax no later than March 15, 2010. The $3,434,000 taxpenalty is on account of a $10,100,000 cash obligation that stillwould have to be paid by December 31, 2010, in order for GGP tomaintain its REIT status, she asserts. Thus, the loss of GGP'sREIT status would cause the Debtors to incur, based on currentprojections, several billion dollars in tax obligations for thetax years 2009 to 2013, she maintains.

Ms. Goldstein adds that the Official Committee of UnsecuredCreditors has informed the Debtors that it does not oppose theproposed Dividend declaration and payment provided that (i) noneof the facts related to the proposed Dividend are altered priorto the entry of an order approving the Motion, and (ii) the cashcomponent of the Dividend does not exceed 10% of GGP's aggregateREIT-related dividend obligation.

Ms. Goldstein further discloses that the Debtors must declare theDividend prior to December 31, 2009 and pay the same byJanuary 29, 2010. Thus, the Debtors ask the Court that any orderapproving the Motion should be effective immediately by providingthat the 14-day stay under Rule 6004(h) of the Federal Rules ofBankruptcy Procedure is waived.

The Debtors further ask the Court to shorten notice with respectto the Dividend Motion, and consider the Dividend Motion at ahearing scheduled for December 18, 2009.

About General Growth Properties

Based in Chicago, Illinois, General Growth Properties, Inc. --http://www.ggp.com/-- is the second-largest U.S. mall owner, having ownership interest in, or management responsibility for,more than 200 regional shopping malls in 44 states, as well asownership in master planned community developments and commercialoffice buildings. The Company's portfolio totals roughly200 million square feet of retail space and includes more than24,000 retail stores nationwide. General Growth is a self-administered and self-managed real estate investment trust. TheCompany's common stock is trading in the pink sheets under thesymbol GGWPQ.

GENERAL MOTORS: New GM Returns $140MM Treasury Loan---------------------------------------------------General Motors Company returned $140 million of the $290 millionreceived from the United States Department of the Treasury forpayments to parts suppliers, The Associated Press reported onNovember 24, 2009.

Originally, $2.5 billion was pledged to GM from the TreasuryDepartment's bailout to support GM's suppliers, however, GM onlyreceived $290 million, AP explained. GM spokesperson Alan Adlerdisclosed that GM believes that it will only use $150 million, APsaid. Mr. Adler further stated that GM's suppliers drew lessmoney from an account administered by GM as GM's cash flowimproved, AP added.

About General Motors

General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. Withits global headquarters in Detroit, GM employs 209,000 people inevery major region of the world and does business in some 140countries. GM and its strategic partners produce cars and trucksin 34 countries, and sell and service these vehicles through thesebrands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,Vauxhall and Wuling. GM's largest national market is the UnitedStates, followed by China, Brazil, the United Kingdom, Canada,Russia and Germany. GM's OnStar subsidiary is the industry leaderin vehicle safety, security and information services.

GM acquired its operations from General Motors Company, n/k/aMotors Liquidation Company, on July 10, 2009, pursuant to a saleunder Section 363 of the Bankruptcy Code. Motors Liquidation orOld GM is the subject of a pending Chapter 11 reorganization casebefore the U.S. Bankruptcy Court for the Southern District of NewYork.

At September 30, 2009, GM had $107.45 billion in total assetsagainst $135.60 billion in total liabilities.

About Motors Liquidation

General Motors Corporation and three of its affiliates filed forChapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead CaseNo. 09-50026). General Motors changed its name to MotorsLiquidation Co. following the sale of its key assets to a company60.8% owned by the U.S. Government.

Bankruptcy Creditors' Service, Inc., publishes General MotorsBankruptcy News. The newsletter tracks the Chapter 11 proceedingundertaken by General Motors Corp. and its various affiliates.(http://bankrupt.com/newsstand/or 215/945-7000)

GENERAL MOTORS: Treasury Says It May Not Get Full Investment------------------------------------------------------------Dow Jones Newswires' Meena Thiruvengadam reports that U.S.Treasury Secretary Timothy Geithner this week told theCongressional Oversight Panel, one of several entities overseeingthe Troubled Asset Relief Program, there is a significantlikelihood "we will not be repaid for the full value of ourinvestments in AIG, GM, and Chrysler."

Dow Jones notes the Treasury in fiscal year 2009 alone estimatedits losses on capital provided to those firms to be near $61billion.

According to a report released by the Government AccountabilityOffice -- and reported by the Troubled Company Reporter onNovember 10, 2009 -- the Treasury provided $81.1 billion aid tothe U.S. auto industry, of which $62 billion was provided toChrysler Group and GM to help the auto makers in theirrestructuring. In return, the government agency received 9.85%equity in Chrysler, 60.8% equity and $2.1 billion in preferredstock in GM, and $13.8 billion in debt obligations between theauto makers.

GAO estimated that the equity value of Chrysler Group necessary torecoup investment must be $54.8 billion while GM would need to beworth $66.9 billion. The agency also assumed that $5.4 billionthat was lent to Chrysler and $986 million to GM would not berepaid.

"Treasury is unlikely to recover the entirety of its investment inChrysler or GM, given that the companies' values would have togrow substantially above what they have been in the past," GAOsaid in its 41-page report.

In September 2008, AIG experienced a liquidity crunch when itscredit ratings were downgraded below "AA" levels by Standard &Poor's, Moody's Investors Service and Fitch Ratings. OnSeptember 16, 2008, the Federal Reserve Bank created an$85 billion credit facility to enable AIG to meet increasedcollateral obligations consequent to the ratings downgrade, inexchange for the issuance of a stock warrant to the Fed for 79.9%of the equity of AIG. The credit facility was eventuallyincreased to as much as $182.5 billion.

AIG has sold a number of its subsidiaries and other assets to paydown loans received from the U.S. government, and continues toseek buyers of its assets.

According to Dow Jones' Darrell A. Hughes and Ms. Thiruvengadam,Mr. Geithner said in letters to U.S. lawmakers, the Obamaadministration would extend the $700 billion financial-sectorbailout from its scheduled Dec. 31 expiration but limit newspending to such areas as housing and small business. The reportrelates Mr. Geithner said the financial sector has stabilized, butthe government needs to have funds available through next October.those aimed at job creation. The report notes that PresidentBarack Obama on Tuesday said the White House would use anadditional $50 billion in TARP funds to help small businesses getcredit.

"While we are extending the $700 billion program, we do not expectto deploy more than $550 billion," Mr. Geithner said, Dow Jonesreports. He added the U.S. would seek to exit its TARPinvestments "as soon as practicable."

About AIG

Based in New York, American International Group, Inc., is theleading international insurance organization with operation inmore than 130 countries and jurisdictions. AIG companies servecommercial, institutional and individual customers through themost extensive worldwide property-casualty and life insurancenetworks of any insurer. In addition, AIG companies are leadingproviders of retirement services, financial services and assetmanagement around the world. AIG's common stock is listed on theNew York Stock Exchange, as well as the stock exchanges in Irelandand Tokyo.

Chrysler LLC and 24 affiliates on April 30 sought Chapter 11protection from creditors (Bankr. S.D.N.Y (Mega-case), Lead CaseNo. 09-50002). Chrysler hired Jones Day, as lead counsel; TogutSegal & Segal LLP, as conflicts counsel; Capstone Advisory GroupLLC, and Greenhill & Co. LLC, for financial advisory services; andEpiq Bankruptcy Solutions LLC, as its claims agent. Chrysler haschanged its corporate name to Old CarCo following its sale to aFiat-owned company. As of December 31, 2008, Chrysler had$39,336,000,000 in assets and $55,233,000,000 in debts. Chryslerhad $1.9 billion in cash at that time.

In connection with the bankruptcy filing, Chrysler reached anagreement with Fiat SpA, the U.S. and Canadian governments andother key constituents regarding a transaction under Section 363of the Bankruptcy Code that would effect an alliance betweenChrysler and Italian automobile manufacturer Fiat. Under theterms approved by the Bankruptcy Court, the company formerly knownas Chrysler LLC on June 10, 2009, formally sold substantially allof its assets, without certain debts and liabilities, to a newcompany that will operate as Chrysler Group LLC. Fiat has a 20percent equity interest in Chrysler Group.

General Motors Company -- http://www.gm.com/-- is one of the world's largest automakers, tracing its roots back to 1908. Withits global headquarters in Detroit, GM employs 209,000 people inevery major region of the world and does business in some 140countries. GM and its strategic partners produce cars and trucksin 34 countries, and sell and service these vehicles through thesebrands: Buick, Cadillac, Chevrolet, GMC, GM Daewoo, Holden, Opel,Vauxhall and Wuling. GM's largest national market is the UnitedStates, followed by China, Brazil, the United Kingdom, Canada,Russia and Germany. GM's OnStar subsidiary is the industry leaderin vehicle safety, security and information services.

GM acquired its operations from General Motors Company, n/k/aMotors Liquidation Company, on July 10, 2009, pursuant to a saleunder Section 363 of the Bankruptcy Code. Motors Liquidation orOld GM is the subject of a pending Chapter 11 reorganization casebefore the U.S. Bankruptcy Court for the Southern District of NewYork.

At September 30, 2009, GM had $107.45 billion in total assetsagainst $135.60 billion in total liabilities.

About Motors Liquidation

General Motors Corporation and three of its affiliates filed forChapter 11 protection on June 1, 2009 (Bankr. S.D.N.Y. Lead CaseNo. 09-50026). General Motors changed its name to MotorsLiquidation Co. following the sale of its key assets to a company60.8% owned by the U.S. Government.

Bankruptcy Creditors' Service, Inc., publishes General MotorsBankruptcy News. The newsletter tracks the Chapter 11 proceedingundertaken by General Motors Corp. and its various affiliates.(http://bankrupt.com/newsstand/or 215/945-7000)

Genoil Inc. is a technology development company focused onproviding innovative solutions to the oil and gas industry throughthe use of proprietary technologies. The Company's businessactivities are primarily directed to the development andcommercialization of its upgrader technology, which is designed toeconomically convert heavy crude oil into light synthetic crude.The Company is listed on the TSX Venture Exchange under the symbolGNO as well as the Nasdaq OTC Bulletin Board using the symbolGNOLF.OB.

At September 30, 2009, the Company had C$4,346,205 in total assetsagainst C$2,363,706 in total current liabilities and C$169,167 inconvertible note obligations, resulting in shareholders' equity ofC$1,813,332. At September 30, 2009, the Company had accumulateddeficit of C$66,561,206.

As at September 30, 2009, the Company had incurred accumulatedlosses of C$66,561,206 (December 31, 2008 -- C$62,889,226) sinceinception. The Company said its ability to continue as a goingconcern is in substantial doubt and is dependent on achievingprofitable operations, commercializing its upgrader technology,and obtaining the necessary financing to develop this technologyfurther. The outcome of these matters cannot be predicted at thistime. The Company will continue to review the prospects ofraising additional debt and equity financing to support itsoperations until such time that its operations become self-sustaining, to fund its research and development activities and toensure the realization of its assets and discharge of itsliabilities. While the Company is expending its best efforts toachieve the plans, there is no assurance that any such activitywill generate sufficient funds for future operations.

The Company is not expected to be profitable during the ensuing 12months and therefore must rely on securing additional funds fromeither issuance of debt or equity financing for cashconsideration.

GEORGIA GULF: Moody's Assigns 'B3' Rating on $500 Mil. Notes------------------------------------------------------------Moody's Investors Service assigned a B3 rating to $500 millionsenior secured notes due 2016 to be issued by Georgia GulfCorporation. Proceeds will be used to repay GGC's senior securedrevolver and term loan. Coincident with this refinancing, GGCwill enter into a $300 million senior secured asset-backedrevolving credit facility due 2013. The outlook is stable.

Moody's also affirmed the GGC's other ratings (Corporate FamilyRating of B2) and advised that the ratings on GGC's senior securedrevolver and term loan would be withdrawn upon successfulcompletion of this transaction. In addition, the LGD pointestimates for the unsecured and subordinated notes will also bechanged to reflect this refinancing upon the completion of thetransaction.

"The completion of the exchange offer and the bank amendment willprovide Georgia Gulf with a sustainable capital structure andshould enable it to navigate the current downturn, despitecontinuing uncertainty over the timing of a recovery in thehousing and construction markets," stated John Rogers, Senior VicePresident at Moody's.

The notes are secured by a first-priority lien on substantiallyall of GGC's U.S. assets including equipment, real estate andstock of domestic subsidiaries, as well as 65% of the stock of itsCanadian subsidiaries, subject to certain restrictions. The noteswill have a second-priority lien on GGC's U.S. accounts receivableand inventory. The notes are notched below the corporate familyrating due to the size of the ABL facility, weaker collateralpackage (relative to the ABL), and a very modest amount ofunsecured debt and other liabilities.

GGC's B2 CFR reflects the company's weak financial performance anduncertainty over the timing of a recovery in the US housingmarket. GGC has substantial leverage to a recovery in the UShousing market and Moody's expects a dramatic improvement infinancial metrics coincident with the housing rebound. However,earnings from its chlor alkali operations, which generated moreprofit than expected in the first half of 2009, are expected toexperience a trough in 2010.

The stable outlook assumes the decline in chlor alkali earnings ismore than offset by the benefits from cost reduction efforts andthat the reported four-quarter trailing EBITDA remains above$150 million. The trailing four-quarter metrics endingSeptember 30, 2009 have improved significantly due to the debt forequity swap and a strong third quarter; Debt/EBITDA declined below4.5x. If debt-to-EBITDA remains below 5.0x and Retained CashFlow/Total Debt rises meaningfully above 10%, Moody's wouldconsider the appropriateness of a higher rating. Conversely, anymeaningful shortfall in EBITDA ($10 million or more) or increasein debt ($75 million or more) could prompt a negative outlook.

Ratings assigned:

Georgia Gulf Corporation

-- Senior secured notes at B3, LGD4 (63%)

The last rating action on Georgia Gulf Corporation was on July 30,2009, when Moody's upgraded Georgia Gulf's ratings due to thedebt-for-equity swap.

GHOST TOWN: Failed to Pay 2-Week Worth of Salaries Before Closing-----------------------------------------------------------------Becky Johnson, staff writer at Smokey Mountain News, Ghost Town inthe Sky failed to pay employees for their final two weeks of workbefore shutting down for the winter. Chief executive officerSteve Shiver said the Company still plans to pay employees whatthey are owed, Ms. Johnson notes.

Ghost Town Partners, LLC, operated Ghost Town in the Sky, anamusement park located in the Great Smoky Mountains in MaggieValley, North Carolina. Ghost Town in the Sky --http://www.ghosttowninthesky.com/-- featured staged gunfights, live music and shows, crafts, and food.

Ghost Town Partners filed for Chapter 11 protection on March 11,2009 (Bankr. W.D. N.C. Case No. 09-10271). David G. Gray, Esq.,at Westall, Gray, Connolly & Davis, P.A., and William E. Cannon,Jr., at Brown, Ward & Haynes P.A., represent the Debtor in itsrestructuring efforts. In its bankruptcy petition, the Debtorlisted total assets of $13,035,300 and total debts of $12,305,672.

GOODMAN GLOBAL: Moody's Rates $320 Mil. Senior Notes at 'B3'------------------------------------------------------------Moody's has rated Goodman Global Group, Inc.'s new proposed$320 million senior unsecured holdco PIK note due 2014 B3 and hasassigned a B1 Corporate Family Rating and Probability of Defaultto Goodman Global Group, Inc. The B1 CFR and PDR at thesubsidiary Goodman Global, Inc., will be withdrawn at the close ofthe transaction. The rating on Goodman Global Inc.'s seniorsecured term loan due 2014 was affirmed at Ba3. The ratingsoutlook remains negative.

The negative ratings outlook reflects the view that the weakeconomic environment may continue and considers the increasedleverage from the contemplated $400 million dividend. Thedividend is to be funded through a combination of the new$320 million senior unsecured holdco note and with existing cashon hand. As a result of the dividend, leverage is increasing byalmost a full turn to approximately 4.7x LTM EBITDA. The companyhad recently been performing above Moody's expectations and itscredit metrics were increasingly supportive of a stable ratingsoutlook.

The B3 rating on the new $320 million senior unsecured holdco PIKnote, two notches below the CFR, reflects its lack of guaranteesand its structural subordination to the debt at Goodman GlobalInc, its primary operating company. The debt is being issued byGoodman Global Group, Inc., the primary holding company which isowned by private equity firm Hellman & Friedman LLC.

The Corporate Family Rating and Probability of Default Rating atGoodman Global, Inc., will be withdrawn at the close of thetransaction.

The last rating action on Goodman Global, Inc., was on June 16,2009, when the company's B1 CFR and PDF were affirmed and theoutlook was changed to negative.

Goodman, located in Houston, Texas, is a domestic manufacturer ofheating, ventilation and air conditioning products for residentialand commercial use. Total revenues for the LTM period throughSeptember 30, 2009, were approximately $1.8 billion.

GPX INTERNATIONAL: Expects Assets Sale to Close This Year---------------------------------------------------------GPX International Tire Corporation said it received approval fromthe Bankruptcy Court to complete the sale of its business in threediscrete transactions that are expected to close prior to the endof the year, subject to closing conditions. All three buyers werethe original stalking horse bidders. U.S. Bankruptcy Judge Joan N.Feeney approved these transactions:

-- U.S. Assets -- GPX's U.S. operations will be sold to Alliance Tire Corporation. Alliance submitted the winning bid in an auction conducted after Titan International, Inc., submitted an alternative offer. Alliance will acquire the Company's U.S. operations, including its assets, customer relationships, warehouse footprint, world-wide rights to the Galaxy and Primex brands, the Company's medium radial truck distribution business and the Company's South African entity, GPX Tyre South Africa (Pty.). Alliance is a global leader specializing in the development, manufacture and sale of highly engineered agricultural, forestry, construction and earthmover tires worldwide. Alliance manufactures in Israel and has recently completed a state of the art factory in India. Alliance will continue to market Galaxy, Primex, other GPX brands, and medium radial truck tires to GPX's customer base. GPX customers will benefit from the complementary strengths of the Alliance and GPX product lines, particularly in the agricultural and construction tire segments. Alliance will continue to source products from GPX's valued network of manufacturers in China and elsewhere. The combination of the Alliance and GPX manufacturing resources provides Alliance with a large, diverse, and highly flexible global sourcing platform that is capable of providing competitive products in all segments of the off-the-road tire industry in North America and throughout the world.

-- Canadian Transaction -- GPX's Canadian subsidiary, Dynamic Tire Corp., will be sold to a management buyout team led by Robert Sherkin and Peter Koszo. Under the terms of the transaction, the company's Canadian subsidiary will become a separate entity engaged in the sale and distribution in Canada of Galaxy and Primex brand off-the-road tires, the sale and distribution of medium radial truck and passenger car tires, and private label sourcing. Dynamic will continue to operate this business, purchase tires from longstanding suppliers and provide customers with a high level of customer service as it has done in the past.

-- Solid Tire Transaction -- The Company's Solid Tire business, together with its Gorham, ME; Red Lion, PA; and Hebei, China manufacturing facilities will be sold to MITL Acquisition Company, which is capitalized by an investor group working in cooperation with management. The Solid Tire business will maintain manufacturing operations in the Maine, Pennsylvania and Hebei, China facilities in order to market the MaineTire, MITL, ITL and Brawler brands to its customers.

"The court's approval of these transactions is an excellentoutcome for the Company and its customers, vendors and employees,"said Craig Steinke, GPX's chief executive officer. "We areexcited to work with the three acquirers to close the transactionsprior to the end of the year. In doing so, we will enable thecontinuation of quality and innovation inherent in GPX's brandswhile providing employment for over 95 percent of GPX'sworkforce."

The Company anticipates that all three sales will close prior toDecember 31, 2009.

About GPX International Tire

GPX International Tire Corporation is one of the largestindependent global providers of specialty "off-the-road" tires forthe agricultural, construction, materials handling andtransportation industries. GPX is a worldwide company,headquartered in Malden, Massachusetts, with operations inNorthAmerica, China, Canada, and Germany. A third generationfamily-owned business, GPX and its predecessor companies have beenin business since 1922.

GPX International filed for Chapter 11 on Oct. 26, 2009 (Bankr. D.Mass. Case No. 09-20170). GPX is represented in U.S. BankruptcyCourt by attorneys Harry Murphy of Hanify & King, P.C. asbankruptcy counsel and Peggy Farrell of Hinckley Allen & SnyderLLP as corporate counsel. TM Capital Corp. served as investmentbanker to GPX in connection with these transactions and ArgusManagement Corporation served as GPX's financial advisor. Thepetition says assets and debts range from $100 million to$500 million.

GREATER ATLANTIC FINANCIAL: May File After Bank Takeover--------------------------------------------------------Greater Atlantic Financial Corp., the holding company that ownedGreat Atlantic Bank, said December 9 in a regulatory filing thatit was "highly likely" to cease operations, liquidate, or filebankruptcy.

On December 4, 2009, Greater Atlantic Bank was closed by theOffice of Thrift Supervision and the Federal Deposit InsuranceCorporation was appointed as receiver of the Bank. On that samedate, Sonabank, McLean, Virginia, acquired substantially allbanking operations, including substantially all of the deposits,of the Bank and purchased most of the Bank's assets in atransaction facilitated by the FDIC.

Greater Atlantic Financial's principal asset is its ownership ofthe common stock of the Bank and, as a result of the receivershipof the Bank, the Company has very limited remaining tangibleassets. As the owner of all of the capital stock of the Bank, theCompany would be entitled to the net recoveries, if any, followingthe liquidation or sale of the Bank or its assets by the FDIC.However, at this time, the Company does not expect that it willrealize any such recoveries.

In connection with the receivership of the Bank, both the Companyand the Bank expect to receive notices from substantially all ofthe counterparties to the Company's and/or Bank's materialagreements, of alleged events of default under those agreements,and of those counterparties' intentions to terminate thoseagreements or accelerate the Company's and/or Bank's performanceof those agreements. The Company and/or Bank may dispute certainof those notices. However, in the event of a default by theCompany and/or Bank under one or more of those materialagreements, or in the event of the termination of one or more ofthe material agreements, the Company and/or Bank may be subject topenalties under those agreements and also may suffer cross-defaultclaims from counterparties under the Company's and/or Bank's otheragreements.

As a result of the Bank's receivership, it is highly likely thatthe Company will be required to cease operations and liquidate orseek bankruptcy protection. If the Company were to liquidate orseek bankruptcy protection, the Company believes that there wouldbe no assets available to holders of the capital stock of theCompany.

The sale constitutes a portion of the 45-day option to purchase upto an additional 100,000 shares of Preferred Stock granted to theinitial purchaser in the Company's private placement of 900,000shares of Preferred Stock.

Each share of Preferred Stock is currently convertible into 31.322shares of the Company's common stock, par value $0.01 per share,subject to adjustment as set forth in a Certificate of Powers,Designations, Preferences and Rights filed by the Company with theSecretary of State of the State of Delaware on November 4, 2009.

The Preferred Stock was offered in reliance on exemptions from theregistration requirements of the Securities Act of 1933, asamended that apply to offers and sales of securities that do notinvolve a public offering. As such, the Preferred Stock wasoffered and sold only to (i) "qualified institutional buyers" (asdefined in Rule 144A under the Securities Act), (ii) to a limitednumber of institutional "accredited investors" (as defined in Rule501(a)(1), (2), (3) or (7) of the Securities Act), and (iii) to alimited number of individual "accredited investors" (as defined inRule 501(a)(4), (5) or (6) of the Securities Act).

Resale of Preferreds, Common Shares

Grubb & Ellis on December 7, 2009, filed with the Securities andExchange Commission a Form S-1 Registration Statement under theSecurities Act of 1933 to delay the effective date of theRegistration Statement.

The Registration Statement and accompanying prospectus relate toup to 125,000 shares of the Company's outstanding 12% CumulativeParticipating Perpetual Convertible Preferred Stock, and up to3,915,250 shares of the Company's common stock issuable uponconversion of the Company's 12% Preferred Stock that may be soldby selling stockholders.

The selling stockholders acquired the shares of 12% PreferredStock in a private placement. The Company said it is registeringthe offer and sale of the shares of 12% Preferred Stock and theshares of common stock to satisfy registration rights the Companyhas granted.

The Company will not receive any of the proceeds from the sale ofthe shares of 12% Preferred Stock or shares of common stock by theselling stockholders. The Company has agreed to bear all expensesof registration of the common stock. The selling stockholders, ortheir transferees, pledgees, donees or other successors ininterest, may sell their 12% Preferred Stock and shares of commonstock issuable upon conversion of the 12% Preferred Stock.

The Company will pay cumulative dividends on the 12% PreferredStock from and including the date of original issuance in theamount of $12.00 per share each year, which is equivalent to 12%of the initial liquidation preference per share. Dividends on thePreferred Stock will be payable when, as and if declared,quarterly in arrears, on March 31, June 30, September 30 andDecember 31, beginning on December 31, 2009.

In addition, in the event of any cash distribution to holders ofthe common stock, par value $0.01 per share, of the Company,holders of the 12% Preferred Stock will be entitled to participatein such distribution as if such holders had converted their sharesof Preferred Stock into common stock.

Generally, the Company may not redeem the 12% Preferred Stockbefore November 15, 2014. On or after November 15, 2014, theCompany may, at its option, redeem the 12% Preferred Stock, inwhole or in part, by paying an amount equal to 110% of the sum ofthe initial liquidation preference per share plus any accrued andunpaid dividends to and including the date of redemption.

The Company will hold its Annual Meeting on December 17, 2009.Among the important agenda items at the Meeting is a proposal toamend the Certificate of Incorporation to authorize the increaseof both common and preferred shares and a proposal to declassifythe Board of Directors to conform with prevailing corporategovernance practices.

As reported by the Troubled Company Reporter, Grubb & Ellis onOctober 1, 2009, obtained an amendment to its senior securedrevolving credit facility which, among other things, modifies andprovides the Company an extension from September 30, 2009, toNovember 30, 2009, to (i) effect its recapitalization plan and inconnection therewith to effect a prepayment of at least 72% of theRevolving Credit A Advances, and (ii) sell four commercialproperties, including the two real estate assets that the Companyhad previously acquired on behalf of Grubb & Ellis RealtyAdvisors, Inc.

About Grubb & Ellis Company

Named to The Global Outsourcing 100(TM) in 2009 by theInternational Association of Outsourcing Professionals(TM), SantaAna, California-based Grubb & Ellis Company (NYSE: GBE) --http://www.grubb-ellis.com/-- claims to be one of the largest and most respected commercial real estate services and investmentcompanies in the world. Its 6,000 professionals in more than 130company- owned and affiliate offices draw from a unique platformof real estate services, practice groups and investment productsto deliver comprehensive, integrated solutions to real estateowners, tenants and investors.

Grubb & Ellis Company reported an upside-down balance sheet atSeptember 30, 2009. The Company had total assets of $342,178,000against total liabilities of $357,948,000 at September 30. TheCompany said stockholders' deficit attributable to Grubb & Elliswas $16,410,000; non-controlling interests were $640,000; andtotal deficit was $15,770,000 at September 30.

GUARANTY FINANCIAL: Wants to Have Until March 22 to Propose Plan----------------------------------------------------------------Guaranty Financial Group Inc. and its debtor-affiliates ask theU.S. Bankruptcy Court for the Northern District of Texas to extendtheir exclusive periods in which to propose a Chapter 11 plan ofreorganization and to solicit acceptances until March 22, 2010,and May 21, 2010, respectively. Absent an extension, the Debtorsplan-filing period expires December 25.

The Debtors relate that they must complete their investigation ofpotential causes of action against various third parties regardingthe prepetition operations. The Debtors add that pursuant to anagreement, the Debtors agreed to submit a draft plan anddisclosure statement to the Federal Deposit Insurance Corporationand Wilmington Trust by March 8, 2010, and to file their proposedplan and disclosure statement by March 22, 2010.

Guaranty Financial Group Inc. -- http://www.guarantygroup.com/-- is based in Dallas, Texas. Guaranty Financial is a unitarysavings and loan holding company. The Company's primary operatingentities are Guaranty Bank and Guaranty Insurance Services, Inc.Guaranty Financial filed for bankruptcy after the Guaranty bankwas seized by regulators and sent to receivership under theFederal Deposit Insurance Corporation. Before the bank was takenover, the balance sheet of the holding company had $15.4 billionin assets as of Sept. 30, 2008.

Guaranty Financial together with affiliates filed for Chapter 11on Aug. 27, 2009 (Bankr. N.D. Tex. Case No. 09-35582). Attorneysat Haynes & Boone, LLP, represent the Debtors. According to theschedules attached to its petition, the Company has assets of atleast $24,295,000, and total debts of $323,413,428, including$305 million in trust preferred security.

During July 2009, the Company initiated the final phase of its2009 restructuring plan, which included executive levelorganizational changes and the consolidation of its Asianoperations. As a result of this consolidation, the Company willreduce its global workforce by an additional 29%, bringing total2009 personnel reductions to approximately 50% of first quarter2009 staffing levels.

The Company has said it is on track to complete the final phase ofits 2009 restructuring plan by the end of 2009.

At September 26, 2009, the Company had total assets of $99,108,000against total liabilities of $51,101,000.

About Hampshire Group

Hampshire Group, Limited is a U.S. provider of women's and men'ssweaters, wovens and knits, and a designer and marketer of brandedapparel. Its customers include leading retailers such as JCPenney, Kohl's, Macy's, Belk's and Dillard's, for whom it providestrend-right, branded apparel. Hampshire's owned brands includeSpring+Mercer(R), its "better" apparel line, DesignersOriginals(R), Hampshire's first brand and still a top-seller indepartment stores, as well as Mercer Street Studio(R),Requirements(R), and RQT(R). Hampshire also licenses the GeoffreyBeene(R) and Dockers(R) labels for men's sweaters, both of whichare market leaders in their categories, and licenses JOE JosephAbboud(R) for men's sportswear and Alexander Julian Colours(R) formen's tops.

HAMPSHIRE GROUP: Names Peter Woodward to Board of Directors-----------------------------------------------------------Hampshire Group, Limited, on December 7 announced the appointmentof Peter Woodward to the Company's Board of Directors, effectiveimmediately. Mr. Woodward has also become a member of theCompany's Audit Committee.

Mr. Woodward currently serves as Founder and Managing GeneralPartner of MHW Capital Management, LLC, an investment firmspecializing in large equity positions in public companies withstrong balance sheets that are revitalizing their business plans.Prior to that, Mr. Woodward was Managing Director of Regan FundManagement, where spent more than 10 years managing investmentsranging in size from $15 million to $150 million.

Commenting on the appointment, Heath Golden, Chief ExecutiveOfficer said, "We are very pleased to welcome Peter to the Board.Not only does he bring a strong financial background, but Peter isalso a shareholder, which is a constituency that was notpreviously represented on our Board. We look forward to Peter'scounsel as we continue to drive growth across the business andmaximize shareholder value."

On December 2, 2009, Hampshire Group entered into a letteragreement with Mr. Woodward and MHW Capital Management, aninvestment fund controlled by Mr. Woodward. The Letter Agreement,among other things, restricts Mr. Woodward and MHW from engagingin an acquisition, directly or indirectly, alone or with anotherperson, that results in MHW or its affiliates beneficially owningmore than 14.9% of the common stock of the Company, negotiating orencouraging any corporate sale transaction involving the Company,engaging in the solicitation of proxies for the Company'ssecurities, initiating a tender offer for the securities of theCompany, seeking to call a meeting of the Company's stockholdersor initiate any stockholder proposal, or forming or joining any"group" -- as defined in Section 13(d)(3) of the SecuritiesExchange Act of 1934, as amended -- with respect to the securitiesof the Company or any subsidiary thereof. The Letter Agreementgrants the parties the right to seek specific performance andequitable relief in the event of a breach or threatened breach ofthe Letter Agreement by the other party.

The Company also entered into an indemnification agreement withMr. Woodward.

Pursuant to Mr. Woodward's appointment to the Board, Mr. Woodwardwas granted 20,000 restricted shares of the Company's common stockunder the Hampshire Group, Limited 2009 Stock Incentive Plan.2,000 of the restricted shares will be subject to time-basedvesting while 18,000 of the restricted shares will be subject toperformance-based vesting. With respect to time-based vesting,the restricted shares will vest ratably on each March 31 of 2010through 2013, subject to Mr. Woodward's continued service with theCompany.

With respect to performance-based vesting, 25% of the restrictedshares will vest ratably on each March 31 of 2011 through 2014,provided that, as of each such vesting date, the Company'sconsolidated return on operating income for the preceding fiscalyear has reached specified targets. In the event that the Companymisses its target in a given year, the shares that would otherwisehave vested in that year will be rolled forward to the next yearand will vest simultaneously with the shares already allocated forthat subsequent year should the Company exceed that year's targetby an amount sufficient to cover the prior year's or years'cumulative shortfall. This rollover mechanism will permit sharesto be carried forward over multiple years until the expiration ofthe Plan.

Director Compensation Changes

The Company also disclosed that on December 2, 2009, the Boardunanimously approved changes to the annual cash compensation paidto the Company's non-employee directors. The Board lowered theamount of annual cash compensation of the Company's non-employeedirectors -- other than the Chairman of the Board and the Chairmanof the Audit Committee of the Board -- from $80,000 to $60,000.The compensation will continue to be paid quarterly. The Chairmanof the Board will continue to receive $80,000 in annual cashcompensation. The Chairman of the Audit Committee of the Boardwill receive $65,000 in annual cash compensation. The changes tothe annual cash compensation of the Company's non-employeedirectors will be effective as of January 1, 2010.

2009 Restructuring Plan

During July 2009, the Company initiated the final phase of its2009 restructuring plan, which included executive levelorganizational changes and the consolidation of its Asianoperations. As a result of this consolidation, the Company willreduce its global workforce by an additional 29%, bringing total2009 personnel reductions to approximately 50% of first quarter2009 staffing levels.

The Company has said it is on track to complete the final phase ofits 2009 restructuring plan by the end of 2009.

At September 26, 2009, the Company had total assets of $99,108,000against total liabilities of $51,101,000.

About Hampshire Group

Hampshire Group, Limited is a U.S. provider of women's and men'ssweaters, wovens and knits, and a designer and marketer of brandedapparel. Its customers include leading retailers such as JCPenney, Kohl's, Macy's, Belk's and Dillard's, for whom it providestrend-right, branded apparel. Hampshire's owned brands includeSpring+Mercer(R), its "better" apparel line, DesignersOriginals(R), Hampshire's first brand and still a top-seller indepartment stores, as well as Mercer Street Studio(R),Requirements(R), and RQT(R). Hampshire also licenses the GeoffreyBeene(R) and Dockers(R) labels for men's sweaters, both of whichare market leaders in their categories, and licenses JOE JosephAbboud(R) for men's sportswear and Alexander Julian Colours(R) formen's tops.

HEADLEE MANAGEMENT: Files for Chapter 11 to Reorganize Finances---------------------------------------------------------------Michael Levensohn at Times Herald-Record reports HeadleeManagement Corp. filed for Chapter 11 bankruptcy to reorganize itsfinances and continue operating its KFC restaurants. The filingwas made after Bank of America commenced foreclosure actionsagainst several of the Company's properties in New York andConnecticut. The Company added that KFC attempted to terminatethree franchise agreements.

HOUSE OF DAVID: Case Summary & 3 Largest Unsecured Creditors------------------------------------------------------------Debtor: The House Of David COGIC San Diego, CA aka House Of David Church Of God In Christ aka House Of David COGIC aka House Of David, COGIC aka HOD COGIC aka H. Dvd COGIC P.O. Box 740615 San Diego, CA 92174

Bankruptcy Case No.: 09-18898

Chapter 11 Petition Date: December 9, 2009

Court: United States Bankruptcy Court Southern District of California (San Diego)

AP relates the group in February sued two Atlanta-based companies,claiming it had been defrauded of hundreds of thousands of dollarsover the past few years. Campaign Resources Inc. and JAKProductions countersued, saying they had not been paid hundreds ofthousands of dollars for work performed and that they had beendefamed.

The Angola-based troopers group supports a variety of police-related causes, such as a death benefit for officers killed in theline of duty, college scholarships and money to help troopers inemergencies, AP notes.

The bankruptcy court order directs Liquid Asset Partners LLC andSolid Asset Solutions LLC to sell millions of dollars of inventoryand equipment owned by InkStop. The Liquidation firms are chargedwith the task of re-opening the sale sites in a very short fewdays. They cut deals with landlords and work with utilitycompanies to get heat and electricity turned on. Some stores evenhold sales without heat or electricity, due to delays with utilitycompanies. The discounts in sale stores are 50% off or morestarting Friday, December 11.

"We truly feel for the employees and their families during thisholiday," says Bill Melvin Jr., CEO of Liquid Asset Partners."These stores were closed in an abrupt fashion and we've re-opening them quickly to try to save as much value as possible forall involved. We are open for liquidations in the selected storesand the customer response is tremendous!"

The Bankruptcy Court order states that everything must be sold.Regardless of cost or loss, millions of dollars worth of inventorywill be sold thru 27 locations. The Liquidation firms will beselling at enormous discounts, right from the start. Customerscan buy ink for their printers as well as cameras, and gadgets forthe computer fanatic.

"These electronics represent a huge inventory to sell during themonth of December. To make the sale successful we are prepared todeeply discount the inventory and sell everything in one month!"says Bill Melvin Jr., CEO of Liquid Asset Partners. "The marketis very soft and we are prepared to deeply discount everything,"Mr. Melvin says. "It's stacked high and we're selling it cheap.The public won't want to miss these deals".

InkStop abruptly closed all of its 152 stores and laid off 456employees on October 1, 2009. According to a November 15 articleby Sasha M. Pardy posted at CoStar.com, InkStop said at that timethe closures were temporary, giving the Company time torestructure and focus on its cash flow problems.

On November 5, 2009, InkStop Inc. filed for Chapter 7 bankruptcy.According to The Plain Dealer in Cleveland, the Company said itowes too much money to reopen and will instead liquidate itsassets and close for good. InkStop had told employees it hadn'tpaid their health care premiums for the past month and didn't havethe money to issue their final paychecks.

According to The Plain Dealer, the Company's board said via its495-page Court filing that InkStop owes nearly $48.3 million tomore than a 1,000 creditors. The Plain Dealer said board memberschipped in the $20,379.97 in fees and expenses to file forbankruptcy. The Plain Dealer also said InkStop owes $1.1 millionin wages, vacation pay and expense reimbursements to employees,including $63,804.17 owed to CEO and co-founder Dirk Kettlewell.

InkStop is the subject of numerous lawsuits and legal complaints,including 95 evictions.

Steven Davis, Esq., represents InkStop in the bankruptcy.

According to the CoStar.com article, InkStop's bankruptcy is instark contrast to an April 2009 Crain's article. At that time,Mr. Kettlewell said InkStop was benefiting from "not beinginvolved in the banking thing," as its growth was fueled by morethan $80 million in private equity funding from 150 investorsworldwide that expected InkStop to grow into a large chain of2,000 to 3,000 stores. According to Crain's, Mr. Kettlewell saidhe expected InkStop to become profitable later in 2009 "for thefirst time ever."

The liquidation sale is going on now at 27 selected liquidationlocations in Philadelphia, PA, Washington, DC, Cleveland, OH,Detroit, MI, Atlanta, GA, St. Louis, MO, Dallas, TX and Denver, COmarkets. It is open to the public everyday until everything issold. Hours of operation are 10 am till 7 pm Monday thru Saturdayand 12 noon to 5 pm on Sunday. Buyers may view sale locationsonline at http://www.LiquidAssetPartners.com/

JEFFREY SHOTKOSKI: Denial of Final Decree was Appropriate in Case-----------------------------------------------------------------WestLaw reports that in denying the Chapter 11 debtors' motion forentry of a final decree on the basis that the estate had not been"fully administered," the bankruptcy court neither made a clearerror of judgment nor exceeded the bounds of permissible choice,the Eighth Circuit's Bankruptcy Appellate Panel (BAP) ruled. Planpayments had not yet been completed, and so the debtors had notreceived their discharge. The bankruptcy court was familiar withthe facts and circumstances of the case and was aware, inparticular, of the specific terms of the confirmed plan, whichprovided for the long-term repayment of several real estate andother loans totaling more than $1.7 million and eight classes ofimpaired claims. Whether an estate is "fully administered" fallswithin the discretion of the bankruptcy judge and is to bedetermined on a case-by-case basis, the BAP instructed. In reShotkoski, ---B.R.----, 2009 WL 4042665 (8th Cir. BAP (S.D.)).

Jeffrey Joseph Shotkoski and Constance Lynn Shotkoski own, manageand operate storage units and residential rental properties inSouth Dakota. Mr. and Mrs. Shotkoski filed a chapter 11 petition(Bankr. D. S.D. Case No. 07-40755) on Dec. 28, 2007, arerepresented by Clair R. Gerry, Esq. and Laura L. Kulm Ask, Esq.,at Stuart, Gerry & Schlimgen in Sioux Falls, and estimated theirassets and debts at $1 million to $10 million at the time of thefiling. Their amended disclosure statement was approved by thebankruptcy court on July 2, 2008, and an order confirming plan wasentered on September 16, 2008. When the Debtors requested entryof a final decree in Sept. 2009, the Honorable Charles L. Nail,Jr., denied the request, saying that Bankruptcy Rules 3020, 3021,and 3022 do not contemplate the closing of an individual's chapter11 case until the administration of the case -- which wouldinclude entry of the debtor's discharge -- is complete.

JOY MUKHERJI: Business as Usual Despite Chapter 11 Filing---------------------------------------------------------Joy Mukherji and Inderjit Kalia in October sought protection fromtheir creditors in U.S. Bankruptcy Court in Santa Rosa,California, saying they owe creditors more than $10 million.

The Debtors own Days Inn on Santa Rosa Avenue, a 104-room hotel.

The property will stay open while they try to restructure theirdebt, said Ms. Mukherji, according to a report by The PressDemocrat. "It's business as usual," she said. "We're paying allour bills."

The filing came after business fell 40% during this year'seconomic slump, according to The Press Democrat's Steve Hart.Sonoma County hotel occupancy is down about 10% from last year,said Ken Fischang, who heads the county's Tourism Bureau,according to the report.

The Debtors owe $6.5 million to Heritage Bank and Summit Bank.

KRISPY KREME: KK Mexico Posts $487,000 Net Loss for Nov. 1 Qtr--------------------------------------------------------------Krispy Kreme Mexico, S. de R.L. de C.V. reported a net loss of$487,000 for the fiscal third quarter ended November 1, 2009, froma net loss of $146,000 for the quarter ended November 2, 2008.Krispy Kreme Mexico posted a net loss of $606,000 for the ninemonths ended November 1, 2009, from a net loss of $411,000 for thenine months ended November 2, 2008.

Krispy Kreme Doughnuts Inc. has a 30% interest in Krispy KremeMexico. KKDI said in a regulatory filing KK Mexico's operatingresults have been adversely affected by economic weakness in thatcountry. The franchisee also has been adversely affected by adecline in the value of the country's currency relative to theU.S. dollar, which has made the cost of goods imported from theU.S. more expensive, and which has increased the amount of cashrequired to service the portion of the franchisee's debt that isdenominated in U.S. dollars.

KKDI said during the second quarter of fiscal 2010, managementconcluded that the decline in the value of the investment wasother than temporary and, accordingly, KKDI recorded a charge ofapproximately $500,000 during that period to reduce the carryingvalue of the investment in KK Mexico to its estimated fair valueof $700,000.

During the nine months ended November 1, 2009, KKDI increased itsbad debt reserve related to KK Mexico by approximately $500,000,of which approximately $120,000 and $380,000 is included in KKSupply Chain and International Franchise direct operatingexpenses, respectively; such reserve at November 1, 2009, is equalto the Company's aggregate receivables from this franchisee.

About Krispy Kreme

Based in Winston-Salem, North Carolina, Krispy Kreme DoughnutsInc. (NYSE: KKD) -- http://www.KrispyKreme.com/-- is a retailer and wholesaler of doughnuts. The company's principal business,which began in 1937, is owning and franchising Krispy Kremedoughnut stores where over 20 varieties of doughnuts are made,sold and distributed and where a broad array of coffees and otherbeverages are offered.

Kremeworks, LLC, which is 25%-owned by KKDI, has failed to complywith certain financial covenants related to its indebtedness, aportion of which matured, by its terms, in January 2009.Kremeworks has requested that the lender waive the loan defaultsresulting from the covenant violations and refinance the maturingindebtedness. In the event the lender is unwilling to do so anddeclares the entire indebtedness immediately due and payable, theCompany could be required to perform under its guarantee.

Krispy Kreme Doughnuts said Kremeworks could have insufficientcash flows from its business to service the indebtedness even ifit is refinanced, which might require capital contributions toKremeworks by the Company and the majority owner of Kremeworks --which has guarantees of the Kremeworks indebtedness roughlyproportionate to those of the Company -- for Kremeworks to complywith the terms of the any new loan agreement.

* * *

As reported by the Troubled Company Reporter on September 30,2009, Standard & Poor's Ratings Services revised its ratingsoutlook on Krispy Kreme Doughnuts to stable from negative. Theoutlook revision incorporates S&P's expectation that the companywill have adequate liquidity in the near term based on S&P'sexpectation of its performance in the near term, its current cashposition, and covenant cushion. S&P affirmed the 'B-' corporatecredit rating. While the sales pressure will continue, S&Pexpects the declines to decelerate and profitability to somewhatstabilize or, at the very least, allow the company to remaincovenant compliant in the current and next fiscal year.

KRISPY KREME: KKSF Incurs Defaults Under Credit Facilities----------------------------------------------------------Krispy Kreme Doughnuts Inc. disclosed in a regulatory filing thatcurrent liabilities at November 1, 2009, include accruals forpotential payments under loan guarantees of roughly $2.6 millionrelated to Krispy Kreme of South Florida, LLC. KKSF incurreddefaults with respect to certain credit agreements with itslenders, including agreements related to KKSF indebtednessguaranteed, in part, by the Company.

In the first quarter of fiscal 2010, KKSF completed a transactionwhich resulted in KKDI's release from a lease guarantee for whichKKDI's potential obligation was approximately $5.5 million, butwhich increased KKDI's guarantee of KKSF debt obligations byapproximately $1.0 million.

KKSF's unaudited revenues, operating income and net income basedupon information provided by the franchisee were $2.6 million,$220,000, and $170,000, respectively, for the three months endedNovember 1, 2009 and $8.5 million, $1.3 million and $1.1 million,respectively, for the nine months then ended.

About Krispy Kreme

Based in Winston-Salem, North Carolina, Krispy Kreme DoughnutsInc. (NYSE: KKD) -- http://www.KrispyKreme.com/-- is a retailer and wholesaler of doughnuts. The company's principal business,which began in 1937, is owning and franchising Krispy Kremedoughnut stores where over 20 varieties of doughnuts are made,sold and distributed and where a broad array of coffees and otherbeverages are offered.

Kremeworks, LLC, which is 25%-owned by KKDI, has failed to complywith certain financial covenants related to its indebtedness, aportion of which matured, by its terms, in January 2009.Kremeworks has requested that the lender waive the loan defaultsresulting from the covenant violations and refinance the maturingindebtedness. In the event the lender is unwilling to do so anddeclares the entire indebtedness immediately due and payable, theCompany could be required to perform under its guarantee.

Krispy Kreme Doughnuts said Kremeworks could have insufficientcash flows from its business to service the indebtedness even ifit is refinanced, which might require capital contributions toKremeworks by the Company and the majority owner of Kremeworks --which has guarantees of the Kremeworks indebtedness roughlyproportionate to those of the Company -- for Kremeworks to complywith the terms of the any new loan agreement.

* * *

As reported by the Troubled Company Reporter on September 30,2009, Standard & Poor's Ratings Services revised its ratingsoutlook on Krispy Kreme Doughnuts to stable from negative. Theoutlook revision incorporates S&P's expectation that the companywill have adequate liquidity in the near term based on S&P'sexpectation of its performance in the near term, its current cashposition, and covenant cushion. S&P affirmed the 'B-' corporatecredit rating. While the sales pressure will continue, S&Pexpects the declines to decelerate and profitability to somewhatstabilize or, at the very least, allow the company to remaincovenant compliant in the current and next fiscal year.

KRISPY KREME: Kremeworks Lenders Grant Covenant Waiver------------------------------------------------------Krispy Kreme Doughnuts Inc. has a 25% interest in Kremeworks, LLC,whose results of operations and operating cash flow have declinedand, although Kremeworks has paid all interest, fees and scheduledamortization of principal due under its bank indebtedness, itfailed to comply with certain financial covenants related to suchindebtedness, a portion of which matured, by its terms, in January2009.

KKDI has guaranteed 20% of such indebtedness. During the thirdquarter of fiscal 2010, Kremeworks completed an amendment to itsdebt agreement which, among other things, waived the defaultsrelated to the failure to comply with the financial covenants andextended the maturity of the indebtedness until July 2010.

In connection with that amendment, KKDI and the majority owner ofKremeworks (which also is a guarantor of the indebtedness) madecapital contributions to Kremeworks in the aggregate amount of$500,000, the proceeds of which were used to prepay a portion ofthe indebtedness. KKDI's portion of this capital contribution was$125,000.

The aggregate amount of Kremeworks indebtedness as of November 1,2009, was approximately $6.9 million, of which approximately$1.4 million is guaranteed by KKDI. The amendment also requiresKremeworks to make an additional prepayment of principal in theamount of $500,000 on or before December 31, 2009, which couldnecessitate additional capital contributions to Kremeworks.

KKDI has a $900,000 note receivable from Kremeworks which issubordinate to the Kremeworks bank indebtedness. The note arosefrom cash advances made by the Company to Kremeworks in fiscal2005 and earlier years. During the quarter ended November 2,2008, KKDI established a reserve equal to the entire $900,000balance of its note receivable in recognition of the uncertaintysurrounding its ultimate collection.

Kremeworks reported a net loss of $785,000 for the fiscal thirdquarter ended November 1, 2009, from a net loss of $807,000 forthe quarter ended November 2, 2008. Kremeworks posted a net lossof $1,832,000 for the nine months ended November 1, 2009, from anet loss of $1,676,000 for the nine months ended November 2, 2008.

About Krispy Kreme

Based in Winston-Salem, North Carolina, Krispy Kreme DoughnutsInc. (NYSE: KKD) -- http://www.KrispyKreme.com/-- is a retailer and wholesaler of doughnuts. The company's principal business,which began in 1937, is owning and franchising Krispy Kremedoughnut stores where over 20 varieties of doughnuts are made,sold and distributed and where a broad array of coffees and otherbeverages are offered.

Kremeworks, LLC, which is 25%-owned by KKDI, has failed to complywith certain financial covenants related to its indebtedness, aportion of which matured, by its terms, in January 2009.Kremeworks has requested that the lender waive the loan defaultsresulting from the covenant violations and refinance the maturingindebtedness. In the event the lender is unwilling to do so anddeclares the entire indebtedness immediately due and payable, theCompany could be required to perform under its guarantee.

Krispy Kreme Doughnuts said Kremeworks could have insufficientcash flows from its business to service the indebtedness even ifit is refinanced, which might require capital contributions toKremeworks by the Company and the majority owner of Kremeworks --which has guarantees of the Kremeworks indebtedness roughlyproportionate to those of the Company -- for Kremeworks to complywith the terms of the any new loan agreement.

* * *

As reported by the Troubled Company Reporter on September 30,2009, Standard & Poor's Ratings Services revised its ratingsoutlook on Krispy Kreme Doughnuts to stable from negative. Theoutlook revision incorporates S&P's expectation that the companywill have adequate liquidity in the near term based on S&P'sexpectation of its performance in the near term, its current cashposition, and covenant cushion. S&P affirmed the 'B-' corporatecredit rating. While the sales pressure will continue, S&Pexpects the declines to decelerate and profitability to somewhatstabilize or, at the very least, allow the company to remaincovenant compliant in the current and next fiscal year.

KRISPY KREME: Reports $2,388,000 Net Loss for Nov. 1 Quarter------------------------------------------------------------Krispy Kreme Doughnuts, Inc., reported lower net loss of$2,388,000 for the fiscal third quarter ended November 1, 2009,from a net loss of $5,885,000 for the quarter ended November 2,2008. Krispy Kreme recorded a net loss of $677,000 for the ninemonths ended November 1, 2009, from a net loss of $3,758,000 forthe nine months ended November 2, 2008.

Revenues for the fiscal 2010 third quarter ended November 1, 2009,were $83,600,000 from $94,338,000 for the 2008 quarter. Revenueswere $259,750,000 for the nine months ended November 1, 2009, from$292,216,000 for the year ago period.

At September 30, 2009, the Company had total assets of$173,142,000, against total current liabilities of $40,430,000,long-term debt, less current maturities of $48,128,000, deferredincome taxes of $106,000, and other long-term obligations of$23,619,000. At September 30, 2009, the Company had accumulateddeficit of $303,810,000 and shareholders' equity of $60,859,000.

The Company's Secured Credit Facilities are the Company'sprincipal source of external financing. These facilities consistof a term loan having an outstanding principal balance of$48.8 million as of November 1, 2009, maturing in February 2014and a $25 million revolving credit facility maturing in February2013.

Effective April 15, 2009, the Company executed amendments to theSecured Credit Facilities which, among other things, relaxed theinterest coverage ratio covenant contained therein through fiscal2012. In connection with the amendments, the Company prepaid$20 million of the principal balance outstanding under the termloan, paid fees of approximately $1.9 million, and agreed toincrease the rate of interest on outstanding loans by 200 basispoints annually. Any future amendments or waivers could result inadditional fees or rate increases.

Based on the Company's current working capital and its operatingplans, management believes the Company will be able to comply withthe amended financial covenants and be able to meet its projectedoperating, investing and financing cash requirements.

During the three months ended November 1, 2009, the Companyreceived $482,000 of cash proceeds from the bankruptcy estate ofFreedom Rings, LLC, a former subsidiary which filed for bankruptcyin the third quarter of fiscal 2006.

Based in Winston-Salem, North Carolina, Krispy Kreme DoughnutsInc. (NYSE: KKD) -- http://www.KrispyKreme.com/-- is a retailer and wholesaler of doughnuts. The company's principal business,which began in 1937, is owning and franchising Krispy Kremedoughnut stores where over 20 varieties of doughnuts are made,sold and distributed and where a broad array of coffees and otherbeverages are offered.

Kremeworks, LLC, which is 25%-owned by KKDI, has failed to complywith certain financial covenants related to its indebtedness, aportion of which matured, by its terms, in January 2009.Kremeworks has requested that the lender waive the loan defaultsresulting from the covenant violations and refinance the maturingindebtedness. In the event the lender is unwilling to do so anddeclares the entire indebtedness immediately due and payable, theCompany could be required to perform under its guarantee.

Krispy Kreme Doughnuts said Kremeworks could have insufficientcash flows from its business to service the indebtedness even ifit is refinanced, which might require capital contributions toKremeworks by the Company and the majority owner of Kremeworks --which has guarantees of the Kremeworks indebtedness roughlyproportionate to those of the Company -- for Kremeworks to complywith the terms of the any new loan agreement.

KROPP EQUIPMENT: Wants to Access Standard Bank's Cash Collateral----------------------------------------------------------------Kropp Equipment, Inc., seeks authority from the Hon. J. PhilipKlingeberger of the U.S. Bankruptcy Court for the NorthernDistrict of Indiana to use Standard Bank's $6,437,000 in cashcollateral securing their obligation to their prepetition lenders.

The Debtor owes the Bank in the approximate amount of $1,020,000.Standard Bank asserts a blanket lien on the assets of the Debtorincluding deposit accounts, accounts receivable and proceeds. TheDebtor believes that the value of the Bank's security interest incash collateral is currently estimated at $240,000.

In exchange for using the cash collateral, the Debtors propose togrant the prepetition lenders a replacement lien on assets to theBank and each secured creditor to the full extent of the value ofthat creditor's lien at the commencement of the case. Financialreports will be provided to the Bank and other secured creditorsherein to provide ongoing information as to the status ofoperations, sales and the creation of post-petition accountsreceivable.

Banc of America Leasing & Capital, LLC (BALC) filed an objectionto the use of cash collateral.

Before the Debtor's bankruptcy filing, BALC filed a verifiedcomplaint against the Debtor and Albert Kropp in the NorthernDistrict Court of Illinois, due to their failure to make paymentunder two promissory notes related to the purchase of certainequipment. On November 17, 2009, a Writ of REplevin was enteredby the district court directing the U.S. Marshal to take from theDebtor and Albert Kropp the equipment subject to the promissorynotes as identified on Exhibit 1 of the Writ of Replevin, a copyof which is available for free at:

On November 18, 2009, the Debtor confirmed that it isn't assertingany interest in BALC's equipment and that the Debtor isn't usingthe equipment.

The Debtor says that the collateral it is seeking to use includesonly collateral that Standard Bank has an undisputed firstposition.

Schererville, Indiana-based Kropp Equipment, Inc., a Corporation,operates from its manufacturing facilities in the state. It wasformed in 1998 with home offices in Schererville, Indiana. TheCompany filed for Chapter 11 bankruptcy protection on December 2,2009 (Bankr. N.D. Ind. Case No. 09-25196). Daniel Freeland (EW),Esq., and Sheila A. Ramacci (JG), Esq., who have offices inHighland, Indiana, assist the Company in its restructuring effort.The Company listed $10,000,001 to $50,000,000 in assets and$10,000,001 to $50,000,000 in liabilities.

This is the first meeting of creditors required under Section341(a) of the U.S. Bankruptcy Code in all bankruptcy cases.

All creditors are invited, but not required, to attend. ThisMeeting of Creditors offers the one opportunity in a bankruptcyproceeding for creditors to question a responsible office of theDebtor under oath about the company's financial affairs andoperations that would be of interest to the general body ofcreditors.

LATSHAW DRILLING: Gets Final Nod to Obtain $500,000 F&M Loan------------------------------------------------------------The Hon Dana L. Rasure of the U.S. Bankruptcy Court for theNorthern District of Oklahoma authorized, on a final basis,Latshaw Drilling Company, LLC to:

-- obtain a $500,000 irrevocable secured letter of credit from The F&M Bank & Trust Company of Tulsa, Oklahoma; and

-- grant a first priority lien and security interest as adequate protection to the lender.

The Debtors will use the loan to fulfill its workers' compensationobligations incurred in its continued business operations and thedeposit of a like sum in an insured certificates of deposit withthe lender to secure the repayment of any funds drawn on the LC.

The Debtor related that the terms of the LC are fair andreasonable and are supported by equivalent value and fairconsideration in order to meet the requirements of its insurer,Zurich American Insurance Company to replace its older, moreexpensive policy issued prior to the petition date. Zurichrequires a $500,000 letter of credit to secure its exposure forthe $100,000 deductible on the policy.

LAZY DAYS': Prepack Plan Confirmed in Less than Five Weeks----------------------------------------------------------Bill Rochelle at Bloomberg News reports that Lazy Days' R.V.Center Inc. has an approved reorganization plan less than fiveweeks after beginning the prepackaged Chapter 11 case. The U.S.Bankruptcy Court for the District of Delaware signed aconfirmation order on Dec. 8 approving the plan that wasaccepted by affected creditor classes before the bankruptcy filingon Nov. 5.

According to the report, the reorganization was hashed out withholders of 82 percent of the $138 million in unsecured bonds thatare being exchanged under the plan for the new stock. In additionto the bonds, Lazy Days' has $22 million in first-lien bank debt.The plan investors are providing $10 million in equity. In return,they receive senior convertible preferred stock. In addition,they provided $65 million in financing for the reorganization thatrolls over after confirmation. Unsecured creditors are paid infull.

About Lazydays

Lazydays(R) -- http://www.BetterLazydays.com/-- was founded in 1976 with two travel trailers and $500. Today, the company'sfocus on unparalleled customer service has made Lazydays thelargest single-site RV dealership in North America.

Lazy Days' was acquired by Bruckmann Rosser Sherrill & Co.II LP in May 2004 in a $217 million transaction. The company hasone mobile home and recreational vehicle sales and servicecenter on 126 acres near Tampa, Florida.

LEHMAN BROTHERS: Gets Approval of Deal With LB RE Financing-----------------------------------------------------------Lehman Brothers Holdings Inc. and its affiliated debtors plan toink a series of agreements with the administrators of LB REFinancing No. 3 Ltd. to maximize recovery from the U.K. company.

In court papers, the Debtors sought and obtained approval of JudgeJames Peck of the U.S. Bankruptcy Court for the Southern Districtof New York to enter into agreements with LB RE to maximizepotential recoveries from the company under a EURO 722,181,000Class B Note due 2054.

The note was issued by Excalibur Funding No. 1 PLC, a specialpurpose vehicle issuer LBHI created early last year to issue realestate backed commercial debt.

Jacqueline Marcus, Esq., at Weil Gotshal & Manges LLP, in NewYork, says the proposed transaction would ensure LBHI to"maintain certain amounts of commercial advisory control" overthe note, which is LB RE's only asset. This would enable LBHI tomanage the note to improve recovery from LB RE and the amountavailable for distribution to LB RE's creditors including LBHI,she says.

Based on LB RE's statement of affairs, which sets out the assetsand liabilities of the company as of October 30, 2008, LBHIexpects to receive distributions of about 98% of the amountsavailable for distribution by LB RE. This represents totalclaims of approximately $1.26 billion against LB RE, which iscurrently in administration proceedings in England and Wales.

The proposed transaction would grant LBHI control over most ofthe decisions concerning the note that would put LBHI in aposition to maximize recoveries. It would also secure LBHI'sright to recover from LB RE amounts advanced to it with respectto the note in priority to any other claims of creditors, andgive LBHI the right to acquire the note or LB RE's shares.

The proposed transaction is comprised of:

(i) an advisory agreement, under which LBHI will act as the exclusive commercial advisor to LB RE in relation to its rights and obligations as registered holder of the note;

(ii) a power of attorney which LB RE has granted to LBHI so that LBHI can exercise its rights under the Advisory Agreement;

(iii) a facilities agreement requiring LBHI to provide LB RE with an initial loan in the amount of the euro equivalent of GBP1,600,000 to fund certain costs in connection with the administration of LB RE, and further loans to the company;

(iv) a letter of indemnity requiring LBHI to indemnify LB RE and the administrators against certain losses; and

(v) a deed granting LBHI an option to acquire LB RE and the loans provided to it by LBHI under the Facilities Agreement as well as an option to acquire the note.

Copies of the documents executed in connection with the proposedtransaction are available for free at:

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LEHMAN BROTHERS: Gets Nod to Transfer Assets of 2 Trust Companies-----------------------------------------------------------------Lehman Brothers Holdings Inc. and its affiliated debtors obtainedapproval of the U.S. Bankruptcy Court for the Southern Districtof New York to execute an agreement that would authorize thetransfer of assets of LBHI's trust companies.

The agreement known as the Assignment and Assumption Agreementauthorizes Lehman Brothers Trust Company of Delaware and LehmanBrothers Trust Company N.A. to transfer some of their assets andobligations to the new trust companies formed by Neuberger BermanGroup LLC.

"The transactions contemplated in the agreement are beneficial tothe Debtors because the profitability of the [Lehman trustcompanies] going forward is likely to be immaterial to theestate," says the Debtors' attorney, Alfredo Perez, Esq., at WeilGotshal & Manges LLP, in Houston, Texas. He adds that the dealwould also allow the Lehman trust companies to transfer and berelieved of some of their liabilities and to retain more assetsthan they would in a wind-down or liquidation.

The Lehman trust companies were originally formed by NeubergerBerman Inc. and were bought by LBHI as part of its acquisition ofNeuberger Berman Inc. in 2003. LBHI did not include the Lehmantrust companies when it sold its investment management unit toNeuberger Berman Group early this year.

Under the deal, Neuberger Berman Group requires LBHI to guaranteethe Lehman trust companies' obligations and indemnify NeubergerBerman Group against certain liabilities. Neuberger Berman Groupalso requires LBHI to seek a court order providing that anyamounts due from LBHI under the Assignment and AssumptionAgreement are entitled to administrative priority over all otherclaims.

According to Mr. Perez, LBHI would benefit from the deal sinceregulatory restrictions on the Lehman trust companies' capitalwould be lifted upon consummation of the deal.

Mr. Perez points out that the trust companies would be able todividend retained net assets to their parent company, LehmanBrothers Bancorp Inc., another subsidiary of LBHI. Bancorp, inturn, would be able to use the additional capital to satisfy itscurrent and future obligations including those related to its twowholly-owned subsidiaries, Woodlands Commercial Bank and AuroraBank FSB, he says.

"To the extent Bancorp has additional assets at its disposal, itwill require less inter-company funding from LBHI," Mr. Perezpoints out.

Neuberger Berman Group's ownership of the Lehman trust companieswould also be beneficial to LBHI and its units since theycollectively own 49% of the common equity and 93% of thepreferred equity in Neuberger Berman Group as a result of thesale of the investment management division, according to Mr.Perez.

The Court will hold a hearing on November 18, 2009, to considerapproval of the Debtors' request. Creditors and other concernedparties have until November 13, 2009, to file their objections.

About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LEHMAN BROTHERS: Chubb Allowed to Pay Litigation Costs------------------------------------------------------At the behest of Lehman Brothers Holdings Inc. and its affiliateddebtors, the U.S. Bankruptcy Court for the Southern District ofNew York lifted the automatic stay to allow Federal InsuranceCompany (Chubb) to pay litigation costs that are covered under thecompany's insurance policy.

Chubb covers loss including defense costs and expenses for claimsmade against the Debtors' directors, officers or employees duringthe period May 16, 2007 to May 16, 2008. The company's insurancepolicy provides up to $15 million in coverage.

The Debtors' personnel are currently facing various legal cases,which include securities actions filed in both federal and statecourts for wrongful acts allegedly committed by the personnel inconnection with the securities issued by LBHI. The Debtors'personnel are also facing investigations commenced by the U.S.Department of Justice, the Securities and Exchange Commission,and the New Jersey Bureau of Securities to find out what causedthe demise of the Debtors.

Richard Krasnow, Esq., at Weil Gotshal & Manges LLP, in New York,says the payment would ensure the personnel's continued access tofunding of additional defense cost in case the $20 millionprovided under the insurance policy issued by their primaryinsurer is exhausted.

XL Specialty Insurance Company, the Debtors' primary insurer,issued directors and officers liability insurance policy thatprovides up to $20 million in coverage. The Debtors, however,anticipate that the $20 million of primary coverage would beexhausted by December 2009 or in early 2010 given the currentstate of the legal proceedings.

"Confirming [Chubb's]) ability to pay such defense costs and feesis in the best interests of the Debtors' estates and creditorsbecause, inter alia, it will avoid the possible collateralestoppel effect on the Debtors that could result if theindividuals' inability to defend themselves were to give rise tojudgments and findings that impacted direct claims against theDebtors," Mr. Krasnow says.

About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LEHMAN BROTHERS: Gets Nod to Set Process to Restructure Loan Terms------------------------------------------------------------------Lehman Brothers Holdings Inc. and its affiliated debtors obtainedapproval of the U.S. Bankruptcy Court for the Southern Districtof New York to implement a process governing their real estateloan transactions.

These transactions include (i) restructuring the terms of, (ii)making new or additional debt and equity investments in, and(iii) entering into settlements and compromises in connectionwith existing commercial mortgage loans and other loans eitherowned by the Debtors or in which the Debtors have debt, equityinvestment or other interest, in each case directly or indirectlyin or secured by real property or interests.

The Debtors propose these procedures:

(1) The Debtors may enter into and consummate a Restructuring or Settlement that involves a Real Estate Investment having an aggregate Mark-to-Market Carrying Value of up to and including $10 million without further order of the Court or notice to or approval of any party.

(2) The Debtors may enter into and consummate Real Estate Loan Transactions that involve a Real Estate Investment having an aggregate Mark-to-Market Carrying Value of greater than $10 million but less than or equal to $25 million, or the Debtors making a New Investment in an amount up to $5 million without further order of the Court or approval of or notice to any other party; provided the Debtors serve notice to the Official Committee of Unsecured Creditors of those Real Estate Loan Transactions as soon as practicable but in no event later than promptly following the closing of the transactions.

(3) If a Real Estate Loan Transaction involves

(i) a Real Estate Investment having an aggregate Mark-to- Market Carrying Value greater than $25 million but less than or equal to $100 million;

(ii) the Debtors making a New Investment in an amount greater than $5 million but less than or equal to $25 million;

(iii) a Restructuring of the Debtors' debt or equity position in a Real Estate Investment or a Settlement resulting in a reduction in the aggregate value of the Real Estate Investment to a value that is less than 50% of the aggregate Mark-to-Market Carrying Value of the Real Estate Investment; and

(iv) any party to the Real Estate Loan Transaction being either a person employed by the Debtors at any time on or after September 15, 2007, or an entity unaffiliated with the Debtors for which a person employed by the Debtors at any time on or after September 15, 2007, is materially involved in the negotiations of the Real Estate Loan Transaction,

the Debtors will provide to the Creditors' Committee a summary of the proposed Real Estate Loan Transaction identifying the terms of the proposed Real Estate Loan Transaction. The Creditors' Committee will be required to submit any objections to a Real Estate Loan Transaction identified in a Real Estate Loan Transaction Summary so as to be received by the Debtors on or before 10 days after service of the summary; provided that if the Creditors Committee requests additional information regarding a transaction, its objection period will be suspended until the requested information is provided.

If the Debtors and the Creditors' Committee are unable to consensually resolve the objection, the Debtors may file a motion seeking approval of the Real Estate Loan Transaction. If the Creditors' Committee does not timely object to a Real Estate Loan Transaction, or the Debtors and the Creditors' Committee resolve a timely objection, the Debtors may proceed with the transaction without further order of the Court or notice to or approval of any party.

(4) The Debtors will be required to file a motion with the Court seeking approval of any Real Estate Loan Transaction that involves (i) a Real Estate Investment having an aggregate Mark-to-Market Carrying Value greater than $100 million, and (ii) the Debtors making a New Investment in an amount greater than $25 million.

(5) The Debtors may enter into and consummate any Real Estate Loan Transaction that involves a Real Estate Investment having an aggregate Mark-to-Market Carrying Value of greater than $25 million without further order of the Court or notice to or approval of any party, if the transaction involves only (i) a non-material amendment to or modification of a Real Estate Investment, as determined by the Debtors after consultation with the Creditors Committee, and (ii) the Debtors making a New Investment in an amount not greater than $5 million; provided the Debtors will serve notice to the Creditors Committee of that transaction as soon as practicable but in no event later than promptly following the closing of the transaction.

(6) Real Estate Investments managed by the Debtors that are cross-collateralized or cross-defaulted with each other will be aggregated for purposes of applying the thresholds to Real Estate Loan Transactions.

(7) The Debtors ability to carry out the actions pursuant to the procedures will not override any notice, consent or other rights that any third parties may have pursuant to agreements with the Debtors.

As part of the proposed procedures, the Debtors will file inCourt, beginning not later than 105 days after entry of an orderapproving the procedures, a quarterly report of all Real EstateLoan Transactions entered into by the Debtors during the priorthree months.

About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LEHMAN BROTHERS: LBSF Has Nod to Sell Swap Stake to Goldman-----------------------------------------------------------Lehman Brothers Special Financing Inc. won authority from theU.S. Bankruptcy Court for the Southern District of New York tosell its stake in a swap agreement known as 1992 ISDA MasterAgreement with Structured Asset Receivable Trust Series 2005-1for $7.03 million to Goldman Sachs Bank USA or its affiliate,Goldman Sachs Mitsui Marine Derivative Products L.P.

The ISDA agreement dated December 15, 2004, allowed LBSF and theTrust to enter into an interest rate swap transaction, which isset to expire on January 21, 2015. Lehman Brothers Holdings Inc.serves as credit support provider for LBSF under the agreement.

As of October 21, 2009, LBSF owes $127,041 to Structured AssetReceivable Trust while the trust owes $5,211,270 plus interest toLBSF.

Under its deal with Goldman, LBSF agreed to assume, assign andtransfer to Goldman all of its interest in the swap agreement inreturn for payment of $7.03 million, subject to adjustments to beagreed upon by the companies. Upon assumption of the swapagreement but immediately prior to assignment, Structured AssetReceivable Trust is required to pay $5,084,229 plus interest toLBSF. Meanwhile, LBHI's obligations under the swap agreementwill not be assumed by Goldman.

About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LBCC made the move following Norton Gold's refusal to pay LBCCmore than $18 million as required under the agreement.

Norton Gold allegedly refused to make the payment on grounds thatLBCC defaulted under the agreement when it filed for bankruptcyprotection, giving the Australian company the right to stopissuing payments. It also accused LBCC of not issuingconfirmation, which specifies the payment to be made by theAustralian company, since September 12, 2008.

Although Norton Gold has the right to terminate the swapagreement, it reportedly did not do so because it would berequired to make "significant termination payment" to LBCC,according to LBCC's attorney, Jayant Tambe, Esq., at Jones Day,in New York.

Norton Gold, however, continues to observe the other terms of theagreement except its obligation to pay the $18 million, thelawyer claims in court papers.

"Norton's failure to make the payments due and owing to LBCC isan impermissible exercise of control over property of theestate," Mr. Tambe says, adding that it was a violation of theautomatic stay.

A hearing to consider approval of LBCC's request is scheduled forDecember 16, 2009.

About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LEHMAN BROTHERS: Court OKs Barclays Deal on Transfer of PIM Assets------------------------------------------------------------------James W. Giddens, the Trustee for the Liquidation of LehmanBrothers Inc., the broker-dealer of Lehman Brothers, said onDecember 10 the U.S. Bankruptcy Court has approved a settlementagreement with Barclays to finalize the transfer of PrivateInvestment Management assets to former LBI customers.

This milestone brings to a successful conclusion the AccountTransfer phase of the Securities Investor Protection Actliquidation of LBI, Mr. Giddens said in a statement. Since thedemise of Lehman in September 2008, the Trustee has overseen thesuccessful transfer of 110,000 accounts containing more than $92billion in customer assets to Barclays, Neuberger Berman, andother SIPC member broker dealers. Overall the Trustee isadministering more than $110 billion in the liquidation of LBI,the largest broker-dealer ever to fail. The Trustee's transfersof accounts allowed customers to continue trading within days ofLBI's filing, maintaining liquidity and investor confidencethrough a tumultuous time in the nation's markets.

The PIM conversion of accounts -- effected in accordance withcourt orders, provisions of the SIPA statute, and regulatoryintent -- was the only remaining aspect of the Account Transfersnot yet fully complete. The Securities Investor Protection Corp.,the U.S. Securities and Exchange Commission and the FederalReserve Bank of New York all supported the Trustee's motion andthe Account Transfer process, and with today's ruling their andthe Trustee's goal of customer protection has in fact beenachieved.

The Trustee is acting pursuant to his principal duty to returnproperty to public customers while at the same time maximizing theestate for all creditors. This settlement does not affect theTrustee's separate, pending claims against Barclays in the Rule60(b) motion and adversary proceedings, requesting the Court rulethat billions of dollars of disputed assets that Barclays isclaiming remain the property of the LBI estate. The transfer ofthese assets would create an unfair windfall for Barclays at theexpense of public customers.

The Trustee continues to work through an enormous workload toresolve claims not covered by the Account Transfers in a fair,transparent and orderly process. The Trustee has determined morethan 85% of asserted public customer claims filed by the June 1,2009 deadline, and has made substantial progress in reconcilinglarge, omnibus claims asserted by LBHI, LBIE and others.

About Lehman Brothers

Lehman Brothers Holdings Inc. -- http://www.lehman.com/-- was the fourth largest investment bank in the United States. For morethan 150 years, Lehman Brothers has been a leader in the globalfinancial markets by serving the financial needs of corporations,governmental units, institutional clients and individualsworldwide.

Lehman Brothers filed for Chapter 11 bankruptcy September 15, 2008(Bankr. S.D.N.Y. Case No. 08-13555). Lehman's bankruptcy petitionlisted US$639 billion in assets and US$613 billion in debts,effectively making the firm's bankruptcy filing the largest inU.S. history. Several other affiliates followed thereafter.

On September 19, 2008, the Honorable Gerard E. Lynch, Judge of theU.S. District Court for the Southern District of New York, enteredan order commencing liquidation of Lehman Brothers, Inc., pursuantto the provisions of the Securities Investor Protection Act (CaseNo. 08-CIV-8119 (GEL)). James W. Giddens has been appointed astrustee for the SIPA liquidation of the business of LBI

The Bankruptcy Court has approved Barclays Bank Plc's purchase ofLehman Brothers' North American investment banking and capitalmarkets operations and supporting infrastructure forUS$1.75 billion. Nomura Holdings Inc., the largest brokeragehouse in Japan, purchased LBHI's operations in Europe for US$2plus the retention of most of employees. Nomura alsobought Lehman's operations in the Asia Pacific for US$225 million.

International Operations Collapse

Lehman Brothers International (Europe), the principal UK tradingcompany in the Lehman group, was placed into administration,together with Lehman Brothers Ltd, LB Holdings PLC and LB UK REHoldings Ltd. Tony Lomas, Steven Pearson, Dan Schwarzmann andMike Jervis, partners at PricewaterhouseCoopers LLP, have beenappointed as joint administrators to Lehman Brothers International(Europe) on September 15, 2008. The joint administrators havebeen appointed to wind down the business.

Lehman Brothers Japan Inc. and Lehman Brothers Holdings Japan Inc.filed for bankruptcy in the Tokyo District Court on September 16.Lehman Brothers Japan Inc. reported about JPY3.4 trillion(US$33 billion) in liabilities in its petition.

LENNY DYKSTRA: Patrizzi & Co. to Auction Off Watch and Trophies---------------------------------------------------------------According to an article in The Wall Street Journal's BankruptcyBeat, Patrizzi & Co. is auctioning Lenny Dykstra's designer watchand two trophies from his baseball glory days during an event itcalls "Exceptional Watchmaking Masterpieces -- An ExclusiveCollection of Remarkable Timepieces," according to a catalogue.

The article notes Mr. Dykstra lost control of his bankruptcy casein September after Bankruptcy Judge Geraldine Mund ruled that hecould no longer administer his own finances. A trustee wasappointed to steer the proceedings back on course and generatecash for creditors by selling off Mr. Dykstra's personalbelongings and real estate piece by piece.

According to the article, Mr. Dykstra's assets for auctioninclude:

-- a Patek Phillippe watch made of 18 karat gold, which Patrizzi estimates to be worth between $28,000 and $35,000;

-- Mr. Dykstra's 1986 World Series championship trophy and Plaque, estimated to be worth $18,000 to $25,000.;

-- Mr. Dykstra's "silver slugger" and "player of the week" awards, which he received in 1993 and 1990 respectively, estimated to be worth $12,000 to $16,000.

Westlake Village, California-based Lenny Dykstra is a former MajorLeague Baseball All-Star. He was center fielder for the New YorkMets and Philadelphia Phillies. He filed for Chapter 11bankruptcy protection on July 7, 2009 (Bankr. C.D. Calif. Case No.09-18409). M Jonathan Hayes, Esq., at the Law Office of MJonathan Hayes, in Northridge, California, assists the Debtor inhis restructuring effort. The Debtor listed up to $50,000 inassets and $10,000,001 to $50,000,000 in debts.

LEXINGTON PRECISION: Hearing Set on Rival Plans' Disclosure Docs----------------------------------------------------------------Bill Rochelle at Bloomberg News reports that the Bankruptcy Courtwill convene a hearing on January 11 to consider approval of thedisclosure statements explaining three competing reorganizationproposals. In addition to the Company's plan, the creditors'committee and the secured lenders each filed their own. Theparties have been fighting over whether the business is worthenough so value should be left for shareholders.

About Lexington Precision

Headquartered in New York, Lexington Precision Corp. --http://www.lexingtonprecision.com/-- and its wholly-owned subsidiary Lexington Rubber Group, Inc. conduct their operationsthrough two operating groups, the Rubber Group and the MetalsGroup. The business of the Rubber Group is conducted by LRGIwhile the business of the Metals Group is conducted by LPC.

The Rubber Group is a manufacturer of tight-tolerance, molderrubber componets that are sold to customers who supply theautomotive aftermarket, to customers who supply the automotiveoriginal-equipment manufacturers ("OEMs"), and to manufacturers ofmedical devices. The Metals Group manufactures a variety of high-volume components that are machined from aluminum, brass, steel,and stainless steel bars and blanks. The components produced bythe Metals Group include airbag inflator components, solenoids fortransmissions, fluid handling couplings, hydraulic valve blocks,power steering components, and wiper-system components, primarilyfor use by the automotive OEMs.

Mr. Petersen was to discuss the Company's strategy, its success inproactively managing its business during the evolving economicconditions of 2009, and progress on its strategic initiatives todiversify revenue and drive free cash flow. During thepresentation, Mr. Petersen was to reaffirm the Company's fiscalguidance for the fourth quarter 2009, which was originallyprovided on October 21, 2009.

Some highlights of LodgeNet's recent strategic achievementsinclude:

-- Revenue Diversification: Revenue generated by sources other than guest entertainment purchases increased 15% during the first nine months of 2009 as compared to the same period in 2008 and now represents 40% of total revenue.

-- Proactive Management: Given the economic environment, LodgeNet reduced its operating expenses by 25% and its capital expenditures by 70% during the first nine months 2009. As a result of this management approach, the Company increased its cash flow by four fold during the first 9 months of 2009, from $9.9 million in 2008 to $46.3 million in 2009.

-- Debt Reduction: During the first nine months of 2009, LodgeNet reduced its debt by more than 15%, or $92 million.

-- Innovative Product Arrangements: LodgeNet reduced its level of capital investment per interactive room by an average of 20% between new and renewal rooms in 2009, and further capital reductions representing a $50-$75, or 20%-25% savings per average system installation are anticipated through the innovative arrangements LodgeNet recently announced with LG Electronics and Philips, the two leading TV manufacturers for the hospitality market. The two electronics firms are now licensed to integrate LodgeNet's patented b-LAN communications technology directly into their televisions during assembly, creating out-of-the-box "LodgeNet ready" sets.

-- Healthcare: LodgeNet's Healthcare division increased its facilities under contract in 2009 by 30% to more than 55 facilities nationwide. Recently, the division signed agreements with several award-winning hospitals and made inroads into the children's hospital segment, with Children's Hospitals and Clinics of Minnesota joining Morgan Stanley and Children's Pittsburgh, as well as the new Sanford Children's Hospital on LodgeNet's roster of well-known pediatric facilities. LodgeNet Healthcare has also been selected to address the needs of government armed forces facilities at the Veterans Administration hospital in Washington DC, and Naval hospitals in Jacksonville and Pensacola, Florida.

-- The Hotel Networks: THN continues its emergence as an innovative programmer through the introduction of two additional content offerings. Starting in Jan 2010, the English-speaking RT World News Channel will be distributed through THN's private satellite network in over 800 major hotels. In early spring of 2010, Fashion TV "Jet Set Edition" will launch in select upscale hotels throughout the country. This customized channel will be produced with cooperation of FTV, the world's leader in Fashion programming, and will be carried on THN's Interactive channels.

As of September 30, 2009, LodgeNet had $541.5 million in totalassets against $610.5 million in total liabilities, resulting in$68.9 million in stockholders' deficiency.

* * *

As reported by the Troubled Company Reporter on June 10, 2009,Moody's affirmed LodgeNet's B3 corporate family rating, Caa1probability of default rating and SGL-4 speculative gradeliquidity rating (indicating poor liquidity). The ratingcontinues to be influenced primarily by liquidity matters stemmingfrom the company's very limited financial covenant compliancecushion.

LOUISIANA FILM: Faces Trustee's Chapter 7 Liquidation Plea----------------------------------------------------------The Associated Press reports that Gerald Schiff, trustee toLouisiana Film Studios LLC, is asking the Bankruptcy Court toconvert the Chapter 11 case of the former movie studio to Chapter7 liquidation, arguing that the company is unlikely to achieve asuccessful Chapter 11 reorganization because it has no cash,employees and source of income. A hearing is set for Dec. 29,2009, to consider the trustee's request.

Louisiana Film Studios, LLC, was a movie studio based in Harahan,Louisiana.

The AP recounts that fifteen current and former team members paidthe money to Louisiana Film late in 2008 for what they thoughtwould be state movie industry tax credits returning $1.33 for eachdollar invested. State officials said the studio never appliedfor the credits and the money has not been returned.

A group of the credit buyers that include 47 Construction, LLC, etal., filed a petition to put the Company into Chapter 11protection on July 23, 2009 (Bankr. E.D. La. Case No. 09-12232).

The State Court Action arises out of agreements pursuant to whichMillenium Holdings sold its paint business to Akzo Nobel.Millenium Holdings has sued Akzo Nobel in the State Court Action,contending that the parties' agreements obligate Akzo Nobel toindemnify the Debtor against certain liabilities and expenses,Maura K. Monaghan, Esq., at Debevoise & Plimpton LLP, in NewYork, relates.

In a Purchase Agreement dated August 14, 1986, Hanson Trust PLCand HSCM-20, Inc., transferred their paints -- but not theirpigments -- business to Imperial Chemical Industries PLC and ICIAmerican Holdings, Inc. In 2000, the 1986 Purchase Agreement wasnovated to transfer all rights and obligations belonging toHanson Trust and HSCM-20 under the contract to Millenium Holdings-- then known as Millenium Holdings Inc. -- and all rights andobligations of Imperial Chemical and ICI to The Glidden Company,according to Ms. Monaghan.

Under the Purchase Agreement, Millenium Holdings and Akzo Nobelagreed to cross-indemnify each other for percentages of certainenvironmental, product safety, liability, and warranty claims.

On December 13, 2000, Millenium Holdings, Akzo Nobel, amongothers, entered into a settlement agreement to resolve certaindisputes arising between them concerning the interpretation andapplication of certain provisions of the Purchase Agreement.

As part of the settlement, the parties executed a NovationAgreement, by which they agreed to novate and amend certainprovisions of the Purchase Agreement, creating an AmendedPurchase Agreement, Ms. Monaghan relates. The parties alsoagreed to amend the Purchase Agreement with respect toenvironmental indemnity obligations, by identifying sites forwhich each party was responsible.

According to Ms. Monaghan, since the execution of the PurchaseAgreement, there has been extensive litigation against MilleniumHoldings or Akzo Nobel, or both, alleging personal injury,property damage, and public nuisance resulting from the presenceof lead pigment or lead paint from old paint in poorly maintainedresidential housing. The parties have engaged in the requiredcleanup of various environmental sites.

Akzo Nobel wishes to file two types of defenses and counterclaimsagainst Millenium Holdings in the State Court Action:

(1) Akzo Nobel seeks to recover any amounts due to it from the Debtor for expenses and liabilities associated with the paints or pigments, or both business pursuant to indemnity provisions of the 1986 Purchase Agreement.

(2) Akzo Nobel seeks to recover from the Debtor any amounts due under the indemnity provisions for clean-up of environmental sites in the 1986 Purchase Agreement, as amended by the Settlement Agreement.

Each of the claims is based on a right of recoupment and acts asa reduction to the amounts claimed by Millenium Holdings, Ms.Monaghan says. She notes that under New York law, recoupment isthe reduction of a monetary claim "through a process wherebycross demands arising out of the same transaction are allowed tocompensate one another and the balances only to be recovered."

Alternatively, Akzo Nobel's counterclaims qualify as rights ofset-off, which "allows entities that owe each other money toapply their mutual debts against each other, thereby avoiding theabsurdity of making A pay B when B owes A," Ms. Monaghan tellsthe Court.

She states that Akzo Nobel's recoupment defense is not subject tothe automatic stay.

However, Section 362(a)(7) of the Bankruptcy Code provides thatthe automatic stay bars "the setoff of any debt owing to thedebtor that arose before the commencement of the case under thistitle against any claim against the debtor." In an abundance ofcaution, Akzo Nobel wishes to obtain relief from the automaticstay before asserting a set-off defense in the State CourtAction.

In addition, the same claims that are asserted as recoupmentdefenses may entitle Akzo Nobel to affirmative recoveries to theextent that its claims exceed any amounts that it owes toMillenium Holdings. Akzo Nobel wishes to obtain relief from theautomatic stay to assert its rights to the affirmative recoveriesin the State Court Action. Akzo Nobel only seeks permission tolitigate its rights in the State Court Action, and agrees thatthe actual enforcement and collection of an affirmative judgmentagainst Millenium Holdings, if one is entered, in the absence ofa further relief from the stay, would be subject to furtherproceedings and rulings of the Court, Ms. Monaghan assures theCourt.

About Lyondell Chemical

LyondellBasell Industries is one of the world's largest polymers,petrochemicals and fuels companies. It is the global leader inpolyolefins technology, production and marketing; a pioneer inpropylene oxide and derivatives; and a significant producer offuels and refined products, including biofuels. Through researchand development, LyondellBasell develops innovative materials andtechnologies that deliver exceptional customer value and productsthat improve quality of life for people around the world.Headquartered in The Netherlands, LyondellBasell --http://www.lyondellbasell.com/-- is privately owned by Access Industries.

Basell AF and Lyondell Chemical Company merged operations in 2007to form LyondellBasell Industries, the world's third largestindependent chemical company. LyondellBasell became saddled withdebt as part of the US$12.7 billion merger. On January 6, 2009,LyondellBasell Industries' U.S. operations and one of its Europeanholding companies -- Basell Germany Holdings GmbH -- filedvoluntary petitions to reorganize under Chapter 11 of the U.S.Bankruptcy Code to facilitate a restructuring of the company'sdebts. The case is In re Lyondell Chemical Company, et al.,Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondellentities, including Equistar Chemicals, LP, Lyondell ChemicalCompany, Millennium Chemicals Inc., and Wyatt Industries, Inc.filed for Chapter 11. In May 2009, one of the cases was dismissed-- Case No. 09-10068 -- because it is duplicative of Case No. 09-10040 relating to Debtor Glidden Latin America Holdings.

Lyondell has obtained approximately US$8 billion in DIP financingto fund continuing operations. The DIP financing includes twocredit agreements: a US$6.5 billion term loan, which comprises aUS$3.25 billion in new loans and a US$3.25 billion roll-up ofexisting loans; and a US$1.57 billion asset-backed lendingfacility.

Luxembourg-based LyondellBasell Industries AF S.C.A. and anotheraffiliate were voluntarily added to Lyondell Chemical'sreorganization filing under Chapter 11 on April 24, 2009, in orderto seek protection against claims by certain financial and U.S.trade creditors. On May 8, 2009, LyondellBasell Industries added13 non-operating entities to Lyondell Chemical Company'sreorganization filing under Chapter 11 of the U.S. BankruptcyCode. All of the entities are U.S. companies and were added tothe original Chapter 11 filing for administrative purposes. Thefilings will have no impact on current business or operations asnone of the entities manufactures or sells products.

LYONDELL CHEMICAL: Begins Filing Omnibus Claims Objections----------------------------------------------------------Lyondell Chemical Company and its units have begun filing omnibusobjections to claims in their Chapter 11 cases.

In their first omnibus claims objection, the Debtors sought andobtained the Court's approval to disallow and expunge 100 claims,aggregating $194,770,625, that are duplicative of certain claims.The corresponding "Surviving Claims" will remain on the claimsregister in the same priority as filed. The Surviving Claims areneither allowed nor disallowed at this time, subject to any futureobjection on any basis.

In their second omnibus claims objection, the Debtors sought andobtained the Court's approval to disallow and expunge 100 claims,aggregating $2,271,617, that are duplicative of certain claims.

In the third omnibus claims objection, the Debtors sought andobtained the Court's authority to disallow and expunge 100 claims,aggregating $301,199, that are duplicative of certain claims.

LYONDELL BANKRUPTCY NEWS provides definitive coverage of theomnibus claims objections, the responses to those objections, andthe orders entered by the Court in connection with the objections.

About Lyondell Chemical

LyondellBasell Industries is one of the world's largest polymers,petrochemicals and fuels companies. It is the global leader inpolyolefins technology, production and marketing; a pioneer inpropylene oxide and derivatives; and a significant producer offuels and refined products, including biofuels. Through researchand development, LyondellBasell develops innovative materials andtechnologies that deliver exceptional customer value and productsthat improve quality of life for people around the world.Headquartered in The Netherlands, LyondellBasell --http://www.lyondellbasell.com/-- is privately owned by Access Industries.

Basell AF and Lyondell Chemical Company merged operations in 2007to form LyondellBasell Industries, the world's third largestindependent chemical company. LyondellBasell became saddled withdebt as part of the US$12.7 billion merger. On January 6, 2009,LyondellBasell Industries' U.S. operations and one of its Europeanholding companies -- Basell Germany Holdings GmbH -- filedvoluntary petitions to reorganize under Chapter 11 of the U.S.Bankruptcy Code to facilitate a restructuring of the company'sdebts. The case is In re Lyondell Chemical Company, et al.,Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondellentities, including Equistar Chemicals, LP, Lyondell ChemicalCompany, Millennium Chemicals Inc., and Wyatt Industries, Inc.filed for Chapter 11. In May 2009, one of the cases was dismissed-- Case No. 09-10068 -- because it is duplicative of Case No. 09-10040 relating to Debtor Glidden Latin America Holdings.

Lyondell has obtained approximately US$8 billion in DIP financingto fund continuing operations. The DIP financing includes twocredit agreements: a US$6.5 billion term loan, which comprises aUS$3.25 billion in new loans and a US$3.25 billion roll-up ofexisting loans; and a US$1.57 billion asset-backed lendingfacility.

Luxembourg-based LyondellBasell Industries AF S.C.A. and anotheraffiliate were voluntarily added to Lyondell Chemical'sreorganization filing under Chapter 11 on April 24, 2009, in orderto seek protection against claims by certain financial and U.S.trade creditors. On May 8, 2009, LyondellBasell Industries added13 non-operating entities to Lyondell Chemical Company'sreorganization filing under Chapter 11 of the U.S. BankruptcyCode. All of the entities are U.S. companies and were added tothe original Chapter 11 filing for administrative purposes. Thefilings will have no impact on current business or operations asnone of the entities manufactures or sells products.

LYONDELL CHEMICAL: Has Nod to Hire SEG as Accounting Consultant---------------------------------------------------------------Lyondell Chemical Co. and its units obtained the Court's authorityto employ SolomonEdwardsGroup, LLC, as their accountingconsultant, nunc pro tunc to July 31, 2009.

SEG will assist with the Debtors' adoption of "fresh-start"accounting in their Chapter 11 cases. In anticipation of theiremergence from Chapter 11, the Debtors have concluded that theyneed assistance with the Fresh Start Accounting Project becausethey lack the in-house resources to undertake these tasks. TheDebtors' other retained financial professionals generally are notable, and have not been retained, to provide Fresh StartAccounting services, Gerald A. O'Brien, vice president of theDebtors, relates.

SEG employees will perform the normal daily procedures of certainDebtors' accounting employees who have been selected to dedicatetheir time to the Fresh Start Accounting Project. SEG employeeswill perform these daily functions until the Debtors' employeescomplete their temporary assignment on the Fresh Start AccountingProject, according to Mr. O'Brien.

The Services that SEG will provide are different from thoseprovided by PricewaterhouseCoopers, in that SEG will supplyemployees to work for and with the Debtors' employees, whereasPricewaterhouseCoopers will produce and deliver the actual workproduct associated with the Fresh Start Accounting Project, Mr.O'Brien assures the Court. He adds that SEG will seek tocoordinate any services performed at the Debtors' request withthe Debtors' other professionals, as appropriate, to avoidduplication of effort.

The Debtors SEG will pay the firm on an hourly basis, which willbe reimbursed for any direct expenses incurred in connection withits retention in the Debtors' Chapter 11 cases and theperformance of the Services. The current hourly rates of theindividuals expected to comprise SEG's team are:

Mr. O'Brien notes that SEG has requested payment of $250,000 as aretainer for future services to be performed, payable upon Courtapproval of the Application. The amount represents approximately25% of the anticipated revenues to be generated through thisengagement.

If the Debtors hire any full time salaried SEG employee duringthe term of the agreement, the Debtors have agreed to pay ahiring fee of 30% of the employee's annual compensation subjectto the payment terms and conditions provided in the statement ofwork and master agreement dated July 31, 2009, between SEG andthe Debtors -- Audit Services Agreement, according to Mr.O'Brien.

If the Debtors hire an hourly or interim SEG employee during theterm of the Audit Services Agreement, a pro-rated permanentplacement conversion charge will be incurred. The conversion feeis computed on the agreed annual starting salary offered by theDebtors to the interim SEG employee, Mr. O'Brien says.

Candace Caley, a managing director at SEG, tells the Court thatthe firm is not providing and will not provide services to anyindividuals or entities that are present or recent former clientsof SEG that are adverse to the Debtors or related to issuesconnected to the Debtors' bankruptcy. SEG is not providing andwill not provide services to the Debtors that would be adverse toany of those entities, she adds.

However, SEG has provided and likely will continue to provideservices unrelated to the Debtors' Chapter 11 cases for thoseentities. SEG's assistance to these entities has been primarilyrelated to auditing, tax, or other consulting services, Ms. Caleysays.

She assures the Court that no services have been provided tothese creditors or other parties-in-interest, which could impacttheir rights in the Debtors' cases, nor does the firm'sinvolvement in these cases compromise its ability to continue itsauditing, tax, or consulting services.

SEG is a disinterested person as the term is defined in Section101(14) of the Bankruptcy Code, Ms. Caley attests.

LYONDELL CHEMICAL: Review of Reclamation Issues Bifurcated----------------------------------------------------------Pursuant to Section 105 of the Bankruptcy Code and Rules 7042 and9014 of the Federal Rules of Bankruptcy Procedure, LyondellChemical Company and certain of its debtor-subsidiaries andaffiliates sought an obtained from the Court, with respect tocertain remaining unresolved reclamation claims against theDebtors, an order bifurcating the Court's consideration of:

(i) certain legal defenses to reclamation claims based on the existence of prior liens on the goods sought to be reclaimed -- Prior Lien Defense; and

(ii) all other aspects of the asserted reclamation claims and the Debtors' defenses to those claims.

The Debtors also ask the Court to establish a briefing schedulegoverning the consolidated litigation of the Prior Lien Defense,and, if necessary after the Court's determination regarding thePrior Lien Defense, set a date or dates for one or moreconferences regarding the litigation of the remaining reclamationclaims.

The Debtors believe that the Prior Lien Defense will provide acomplete defense to all or substantially all of the outstandingreclamation claims. The proposed bifurcated structure willpromote an efficient and fair resolution of the reclamationclaims, according to Christopher R. Mirick, Esq., at Cadwalader,Wickersham & Taft LLP, in New York.

The Court's February 26, 2009 Order established certainprocedures as the sole and exclusive method for the resolution ofthe Reclamation Claims. Pursuant to the Reclamation Order, nolater than 120 days after the Petition Date, the Debtors wererequired to file a notice listing the Reclamation Claims and theamount, if any, that the Debtors determined to be valid for eachclaim, Mr. Mirick notes.

The Debtors filed the Reclamation Notice with the Court on May 6,2009, valuing the vast majority of Reclamation Claims at zero.

Approximately 50 Reclamation Claimants objected to theReclamation Notice and to the Debtors' determination of theamount and validity of their claims. Subsequently, the Debtorshave contacted each of the Objecting Claimants to resolve theobjections. As of July 15, 2009, 11 of these Objections wereresolved. Several additional parties have advised the Debtors oftheir intent to withdraw their objections, according to Mr.Mirick.

The Reclamation Claims of 49 of the Non-Objecting Claimants,identified in the Reclamation Notice as holding claims valued atzero, are deemed disallowed.

As set forth in the Reclamation Notice, the Debtors reserved theright to assert a different amount with respect to theReclamation Claims valued at other than zero after concludingfurther evaluation of the claims. The Debtors have sincedetermined that, without exception, all Reclamation Claims aresubordinate to the prior rights of a security interest in theapplicable goods or proceeds, and are, therefore, valueless, Mr.Mirick says.

Proposed Procedures and Briefing Schedule

According to Mr. Mirick, the proposed procedures and briefingschedule are intended to address only the validity and extent ofthe Reclamation Claims. The Debtors seek no finding that theReclamation Claimants are not entitled to a different claim forthe value of the goods delivered during the 45-day reclamationperiod, whether under Section 503(b)(9) of the Bankruptcy Code,as an unsecured claim or otherwise.

The rights of all Reclamation Claimants to assert other claimswith respect to the goods they sought to reclaim, and the rightof the Debtors to object to any claims asserted, are reserved.

The Debtors submit that it is appropriate to bifurcate theconsideration of issues relating to the Prior Lien Defense fromany other issues raised by Reclamation Claimants -- Non PriorLien Reclamation Issues. The Prior Lien Defense is a commonlegal defense applicable to all of the Reclamation Claims andpresents a threshold issue as to the validity of each ReclamationClaim.

If the Court determines that the Prior Lien Defense isapplicable, further litigation of the Non Prior Lien ReclamationIssues will be unnecessary because a ruling in favor of theDebtors would render all of the Reclamation Claims valueless,according to Mr. Mirick.

The applicability of the Prior Lien Defense can be resolvedthrough legal briefs and a single hearing, potentially preservingthe resources of the Debtors, the Reclamation Claimants, and theCourt, while obviating the need for heavily fact-intensivelitigation of the Non Prior Lien Reclamation Issues, Mr. Miricksays.

The Debtors request that any and all litigation, includingdiscovery, related to the Non Prior Lien Reclamation Issues bestayed and postponed until after the Court has ruled on theapplicability of the Debtors' Prior Lien Defense. If furtherjudicial development of the Non Prior Lien Reclamation Issues iswarranted, appropriate scheduling orders can be entered at thattime.

The Debtors propose that this briefing schedule be establishedfor the litigation of the Prior Lien Defense:

* The Debtors' initial brief in support of the Prior Lien Defense will be filed with the Court and served on all necessary parties no later than 30 days after entry of the order, at 5:00 p.m., Eastern Time.

* All briefs in response to the Initial Brief must be filed with the Court and served on all necessary parties no later than 30 days after the deadline for filing the Initial Brief, at 5:00 p.m., Eastern Time.

* The Debtors may, but will not be required to, file a reply to the Response Briefs with the Court and serve it on all necessary parties no later than 15 days after the deadline for filing of the Response Briefs, at 5:00 p.m., Eastern Time.

* A hearing would be held at the Court's convenience after completion of the briefing schedule.

If, and to the extent, the Debtors do not prevail with respect tothe Prior Lien Defense, the Debtors will substantively litigatethe merits of the remaining Reclamation Claims. If thislitigation becomes necessary, the Debtors further request thatthe Court hold one or more scheduling conferences at which theCourt would establish the parameters for the separate litigationof each of the remaining Reclamation Claims.

If the Court determines that the Prior Lien Defense asserted bythe Debtors is applicable to the Reclamation Claims and rendersthe claims valueless, the scheduling conference would not benecessary, according to Mr. Mirick.

The Reclamation Claimants would remain entitled to pursue anyother claim they may have for the value of the goods that werethe subject of their Reclamation Claims, whether under Section503(b)(9), as an unsecured claim, or otherwise, subject to theDebtors' right to object to those claims on any applicable basis.

In a separate filing, the Official Committee of UnsecuredCreditors reserved its rights relating to the Motion.

According to its counsel, Steven D. Pohl, Esq., at Brown RudnickLLP, in Boston, Massachusetts, the Creditors Committee has noobjection to the proposed procedures. However, the CreditorsCommittee expressly reserves all of its rights in connection withthe Reclamation Claims.

After having obtained the Court's authority, the CreditorsCommittee, among other things, will be seeking to avoid, onbehalf of the Debtors' estates, many of the Reclamation Claimssubject to prior security interests.

In particular, the Creditors Committee reserves, inter alia, (i)any and all real defenses, including that any Reclamation Claimsotherwise subordinate to prior security interests pursuant toSection 546(c) of the Bankruptcy Code will be subordinate to theunsecured claims against the relevant Debtor's estate in theevent that the prior security interests are avoided and preservedfor the benefit of the Debtors' estates pursuant to Section 551of the Bankruptcy Code, (ii) any and all equitabe defenses, and(iii) any other rights, equitable or otherwise, in relation tothe reconciliation and adjudication of the Reclamation Claims.

About Lyondell Chemical

LyondellBasell Industries is one of the world's largest polymers,petrochemicals and fuels companies. It is the global leader inpolyolefins technology, production and marketing; a pioneer inpropylene oxide and derivatives; and a significant producer offuels and refined products, including biofuels. Through researchand development, LyondellBasell develops innovative materials andtechnologies that deliver exceptional customer value and productsthat improve quality of life for people around the world.Headquartered in The Netherlands, LyondellBasell --http://www.lyondellbasell.com/-- is privately owned by Access Industries.

Basell AF and Lyondell Chemical Company merged operations in 2007to form LyondellBasell Industries, the world's third largestindependent chemical company. LyondellBasell became saddled withdebt as part of the US$12.7 billion merger. On January 6, 2009,LyondellBasell Industries' U.S. operations and one of its Europeanholding companies -- Basell Germany Holdings GmbH -- filedvoluntary petitions to reorganize under Chapter 11 of the U.S.Bankruptcy Code to facilitate a restructuring of the company'sdebts. The case is In re Lyondell Chemical Company, et al.,Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondellentities, including Equistar Chemicals, LP, Lyondell ChemicalCompany, Millennium Chemicals Inc., and Wyatt Industries, Inc.filed for Chapter 11. In May 2009, one of the cases was dismissed-- Case No. 09-10068 -- because it is duplicative of Case No. 09-10040 relating to Debtor Glidden Latin America Holdings.

Lyondell has obtained approximately US$8 billion in DIP financingto fund continuing operations. The DIP financing includes twocredit agreements: a US$6.5 billion term loan, which comprises aUS$3.25 billion in new loans and a US$3.25 billion roll-up ofexisting loans; and a US$1.57 billion asset-backed lendingfacility.

Luxembourg-based LyondellBasell Industries AF S.C.A. and anotheraffiliate were voluntarily added to Lyondell Chemical'sreorganization filing under Chapter 11 on April 24, 2009, in orderto seek protection against claims by certain financial and U.S.trade creditors. On May 8, 2009, LyondellBasell Industries added13 non-operating entities to Lyondell Chemical Company'sreorganization filing under Chapter 11 of the U.S. BankruptcyCode. All of the entities are U.S. companies and were added tothe original Chapter 11 filing for administrative purposes. Thefilings will have no impact on current business or operations asnone of the entities manufactures or sells products.

As reported by the TCR on Dec. 9, 2009, Lyondell Chemical hasreached a settlement in a suit that its unsecured creditors'committee brought against a group of banks over the leveragedbuyout of the bankrupt company by Basell AF S.C.A.

To recall, the Creditors Committee commenced a lawsuit againstCitibank N.A., Deutsche Bank, and other banks that funded the 2007acquisition of Lyondell Chemical by Basell AF. Having accumulatedheavy debt because of the merger, LyondellBasell was in a full-blown liquidity crisis and was running out of money to fund itsoperations only three months following the merger. The CreditorsCommittee asserted claims of, among other things, fraudulenttransfer, breach of fiduciary duty, avoidance of unperfectedsenior liens. Although the Creditors Committee filed the lawsuit,Lyondell retained the rights to settle.

Under the settlement, unsecured creditors would be given$300 million cash on emergence from Chapter 11 along with a trustto bring lawsuits.

However, according to the Creditors Committee, the settlement isboth "procedurally inappropriate and, on a substantive basis,woefully inadequate." In the event the settlement is notapproved, and without an appropriate litigation reserve, Lyondellwon't be able to confirm a Chapter 11 plan, the Committee says.

The Creditors Committee says its alternative reorganizationproposal would create a litigation reserve where the plan could beconfirmed while the creditors continue suing the banks, in theprocess setting cash aside for the lenders should they eventuallywin.

The Creditors Committee says its plan would contemplate atransaction with a strategic investor such as Reliance IndustriesLimited. The price or the amount of Reliance's investment was notdisclosed.

A hearing on the matter is schedule for December 15.

About Lyondell Chemical

LyondellBasell Industries is one of the world's largest polymers,petrochemicals and fuels companies. It is the global leader inpolyolefins technology, production and marketing; a pioneer inpropylene oxide and derivatives; and a significant producer offuels and refined products, including biofuels. Through researchand development, LyondellBasell develops innovative materials andtechnologies that deliver exceptional customer value and productsthat improve quality of life for people around the world.Headquartered in The Netherlands, LyondellBasell --http://www.lyondellbasell.com/-- is privately owned by Access Industries.

Basell AF and Lyondell Chemical Company merged operations in 2007to form LyondellBasell Industries, the world's third largestindependent chemical company. LyondellBasell became saddled withdebt as part of the US$12.7 billion merger. On January 6, 2009,LyondellBasell Industries' U.S. operations and one of its Europeanholding companies -- Basell Germany Holdings GmbH -- filedvoluntary petitions to reorganize under Chapter 11 of the U.S.Bankruptcy Code to facilitate a restructuring of the company'sdebts. The case is In re Lyondell Chemical Company, et al.,Bankr. S.D.N.Y. Lead Case No. 09-10023). Seventy-nine Lyondellentities, including Equistar Chemicals, LP, Lyondell ChemicalCompany, Millennium Chemicals Inc., and Wyatt Industries, Inc.filed for Chapter 11. In May 2009, one of the cases was dismissed-- Case No. 09-10068 -- because it is duplicative of Case No. 09-10040 relating to Debtor Glidden Latin America Holdings.

Lyondell has obtained approximately US$8 billion in DIP financingto fund continuing operations. The DIP financing includes twocredit agreements: a US$6.5 billion term loan, which comprises aUS$3.25 billion in new loans and a US$3.25 billion roll-up ofexisting loans; and a US$1.57 billion asset-backed lendingfacility.

Luxembourg-based LyondellBasell Industries AF S.C.A. and anotheraffiliate were voluntarily added to Lyondell Chemical'sreorganization filing under Chapter 11 on April 24, 2009, in orderto seek protection against claims by certain financial and U.S.trade creditors. On May 8, 2009, LyondellBasell Industries added13 non-operating entities to Lyondell Chemical Company'sreorganization filing under Chapter 11 of the U.S. BankruptcyCode. All of the entities are U.S. companies and were added tothe original Chapter 11 filing for administrative purposes. Thefilings will have no impact on current business or operations asnone of the entities manufactures or sells products.

MAJESTIC STAR: Cash Collateral Use Expires December 18------------------------------------------------------Majestic Star Casino LLC won't be able to use its lenders' cashcollateral after December 18, unless the Bankruptcy Court entersanother order allowing it to further use cash collateral. BillRochelle at Bloomberg News reports that Majestic Star was given atthe end of November authority by the bankruptcy judge to use cashuntil Dec. 18. Another hearing for a more extended use of cashwas schedule for Dec. 17.

According to the report, the first- and second-lien securedlenders consented to the use of cash accompanied by the usualbells and whistles.

About Majestic Star

The Majestic Star Casino, LLC -- aka Majestic Star Casino, akaMajestic Star -- is based in Las Vegas, Nevada. It is a whollyowned subsidiary of Majestic Holdco, LLC, which is a wholly ownedsubsidiary of Barden Development, Inc. The Company was formed onDecember 8, 1993, as an Indiana limited liability company toprovide gaming and related entertainment to the public. TheCompany commenced gaming operations in the City of Gary atBuffington Harbor, located in Lake County, Indiana on June 7,1996. The Company is a multi-jurisdictional gaming company withoperations in three states -- Indiana, Mississippi and Colorado.

The Majestic Star Casino, LLC's balance sheet at June 30, 2009,showed total assets of $406.42 million and total liabilities of$749.55 million. When it filed for bankruptcy, the Company listedup to $500 million in assets and up to $1 billion in debts.

MCDERMOTT INTERNATIONAL: S&P Puts 'BB+' Rating on Negative Watch----------------------------------------------------------------Standard & Poor's Ratings Services placed its ratings on parentMcDermott International Inc. and subsidiary McDermott (J. Ray)S.A. (J. Ray), including the 'BB+' corporate credit rating, onCreditWatch with negative implications. At the same time, S&Paffirmed the ratings on subsidiaries McDermott Inc. and TheBabcock & Wilcox Power Generation Group Inc., including the 'BB+'corporate credit rating. The outlook on these subsidiariesremains positive.

"We base the CreditWatch placement on McDermott International'sannouncement that it plans to separate its operating subsidiariesJ. Ray and The Babcock & Wilcox Co. (which will include thecompany's power generations systems business, as well as thegovernment operations) into two independent, publicly tradedcompanies," said Standard & Poor's credit analyst Robyn Shapiro.S&P expects the transaction to close in nine to 12 months.

To resolve the CreditWatch listing on McDermott International andJ. Ray, Standard & Poor's will meet with management to discuss thedetails of this transaction. "We will assess J. Ray's stand-alone business, as this entity is less likely to continue tobenefit from its current relationship with the company's otherbusinesses," she continued.

The outlook on McDermott Inc. and B&W PGG remain positive. On astand-alone basis, the proposed combined B&W businesses will beless diverse once they are separate from J. Ray. However,McDermott Inc. and B&W PGG could support higher ratings if companypower generations systems business and government operationscontinue to develop solid track records of operating performance,and a commitment to a conservative financial policy.

MCSTAIN ENTERPRISES: Court Dismisses Chapter 11 Bankruptcy Case---------------------------------------------------------------Paula Moore at Denver Business Journal reports that the BankruptcyCourt dismissed the Chapter 11 case of McStain Enterprises Inc.The Company was unable to come up with an effective andconfirmable plan before the deadline set by the court. Thecompany will keep creditors informed of its financial status eachmonth.

MERIDIAN RESOURCE: Fortis Extends Forbearance Until December 14---------------------------------------------------------------The Meridian Resource Corporation and certain of its subsidiarieson December 4, 2009, entered into the Eighth Amendment to theirForbearance and Amendment Agreement with Fortis Capital Corp., asadministrative agent, and the other lenders and agents party tothe Company's Amended and Restated Credit Agreement, dated as ofDecember 23, 2004.

The Eighth Forbearance Amendment extends to December 14, 2009, thedate by which the Fortis Forbearance Agreement will terminate if,by such date, Meridian has not entered into a TransactionAgreement. The Eighth Forbearance Amendment also extends toDecember 14, 2009, the date of the next borrowing baseredetermination.

The Fortis Forbearance Agreement will terminate if, by such date,Meridian has not entered into (a) a merger agreement pursuant towhich Meridian will merge with or into or be acquired by ortransfer all or substantially all of its assets to another person;(b) a capital infusion agreement pursuant to which one or morepersons will contribute subordinated debt or equity capital toMeridian in an amount sufficient to enable Meridian to pay to theLenders an amount equal to 100% of its borrowing base deficiency;or (c) a purchase and sale agreement pursuant to which Meridianagrees to sell one or more oil and gas properties for net proceedssufficient to enable Meridian to pay to the Lenders an amountequal to 100% of its borrowing base deficiency, plus anyincremental borrowing base deficiency resulting from such sales.

On October 20, 2009, the Company entered into the ThirdForbearance Amendment, which extended to November 15, 2009, thedate by which the Fortis Forbearance Agreement would terminate if,by such date, Meridian had not entered into a TransactionAgreement. Under the Third Forbearance Amendment, Meridian wasalso required to pay to the Lenders on November 15 an amendmentfee of 0.25% of the aggregate outstanding borrowings under theAmended and Restated Credit Agreement.

On December 2, 2009, the Company entered into the SeventhForbearance Amendment, effective November 30, which extended toDecember 4 the date by which the cash flow budget for the month ofNovember 2009 may be furnished to Fortis, as required by theFortis Forbearance Agreement.

Concurrently with the execution of the Fortis ForbearanceAgreement, Meridian entered into (a) a Forbearance Agreement withFortis Capital Corp. and Fortis Energy Marketing & Trading GP, (b)a Forbearance and Amendment Agreement with The CIT Group/EquipmentFinancing, Inc., and (c) a Forbearance and Amendment Agreementwith Orion Drilling Company, LLC. The termination of theforbearance period under the Fortis Forbearance Agreement willalso result in the termination of the forbearance periods undereach of the Hedge Forbearance Agreement, the CIT ForbearanceAgreement and the Orion Forbearance Agreement.

On December 4, 2009, Fortis Capital Corp., Fortis Energy Marketing& Trading GP and the Company and certain of its subsidiariesentered into the First Amendment to Forbearance Agreement, whichextended to December 14, 2009, the forbearance period under theHedge Forbearance Agreement.

On December 4, 2009, The CIT Group/Equipment Financing, Inc., theCompany and certain of its subsidiaries entered into the FirstAmendment to Forbearance and Amendment Agreement, which extendedto December 14, 2009, the forbearance period under the CITForbearance Agreement.

Meridian said it cannot give any assurance that, on or before theDecember 14, 2009 expiration of the forbearance periods, it willbe able to enter into a Transaction Agreement or that it willotherwise be able to satisfy obligations under the agreements towhich the forbearance agreements relate, nor can Meridian give anyassurance that its Lenders will grant the Company any furtherextensions under the Fortis Forbearance Agreement.

The members of the lending syndicate under the Eighth Amendmentare:

* FORTIS CAPITAL CORP., as Administrative Agent, Co-Lead Arranger, Bookrunner, Issuing Lender, and a Lender; * THE BANK OF NOVA SCOTIA, as Co-Lead Arranger, Syndication Agent, and a Lender; * COMERICA BANK, as a Lender; * U.S. BANK NATIONAL ASSOCIATION, as a Lender; * ALLIED IRISH BANKS plc, as a Lender

In August 2009, the Company did not have sufficient cash availableto repay the deficiency and, consequently, failed to pay theamount when due and went into default under the credit facilityfor that failure. Meridian negotiated a forbearance agreementwith its bank group which was signed on September 3, 2009regarding the deficiency and default. The forbearance agreementhas been extended for several times, the purpose of which is toallow Meridian more time to execute potential solutions for thedeficiency per the requirements.

About Meridian Resource

Based in Houston, Texas, The Meridian Resource Corporation(NYSE:TMR) -- http://www.tmrc.com/-- is an independent oil and natural gas company engaged in the exploration, exploitation,acquisition and development of oil and natural gas in Louisiana,Texas, and the Gulf of Mexico. Meridian has access to anextensive inventory of seismic data and, among independentproducers, is a leader in using 3-D seismic and other technologiesto analyze prospects, define risk, target and complete high-potential wells for exploration and development. Meridian has afield office in Weeks Island, Louisiana.

At September 30, 2009, the Company had $190,339,000 in totalassets, including $18,090,000 in total current assets, against$120,634,000 in total current liabilities and $17,736,000 in assetretirement obligations.

The Company noted that its default under the debt agreements,which has been mitigated in the short term by certain forbearanceagreements, negatively impacts future cash flow and the Company'saccess to credit or other forms of capital. There is substantialdoubt as to the Company's ability to continue as a going concernfor a period longer than the next 12 months, the Company said.It added that it might have to seek protection under federalbankruptcy laws if it is unable to comply with the forbearanceagreements or if those agreements expire.

METRO-GOLDWYN-MAYER: Forbearance on Debt Extended; Mulled Sale--------------------------------------------------------------Shasha Dai at Dow Jones LBO Wire reports that Metro-Goldwyn-Mayer, Inc., said its lenders agreed to extend forbearance on itsdebt until Jan. 31, 2010, in support of its evaluation ofalternatives.

According to Dow Jones, MGM was also evaluating options, includinga sale of the Company. Reuters, citing people familiar with thematter, states that MGM sent confidentiality agreements to 20interested parties including Time Warner Inc, News Corp, LionsGate Entertainment Corp., and Sony Corp, as a prelude to lettinginterested parties examine its books. Reuters relates that twosources said that former News Corp. president Peter Chernin alsowanted to take a look at MGM.

The sources, according to Reuters, said that MGM was consideringan auction process, but its creditors would like to see how likelybidders value the Company. Reuters reports that MGM was settingup a virtual data room to give bidders access to information.

Metro-Goldwyn-Mayer, Inc., is an independent, privately heldmotion picture, television, home video, and theatrical productionand distribution company. The Company owns the world's largestlibrary of modern films, comprising approximately 4,000 titles,and over 10,400 episodes of television programming. MGM is ownedby an investor consortium, comprised of Providence EquityPartners, TPG Capital, Sony Corporation of America, ComcastCorporation, DLJ Merchant Banking Partners and Quadrangle Group.

As reported by the Troubled Company Reporter on September 30,2009, The New York Post, citing multiple sources, said discussionsbetween debtholders and equity owners on a restructuring of Metro-Goldwyn-Mayer's massive debt load have begun on a contentiousnote, with both sides threatening to force MGM into bankruptcy inorder to gain leverage and extract better terms from the other.

Bloomberg also said that MGM is in talks to skip interest paymentsand restructure $3.7 billion in bank loans. MGM asked creditorsto waive $12 million monthly interest payments until February 152010.

Nikki Finke at Deadline Hollywood reported in October 2009 thatMGM said it needed $20M in short-term cash flow to cover overhead,and an additional $150 million to get through the end of year andcontinue funding its projects. According to filmshaft.com inOctober, MGM was having difficulty making interest payments on its$3.5 billion in debt.

"The CreditWatch listing is based on the company's continuedimproved operating performance and credit measures in fiscal2009," said Standard & Poor's credit analyst Patrick Jeffrey. "Weestimate it has reduced debt leverage to 1.5x for the 12 monthsended Sept. 30, 2009, from 2.1x in fiscal 2008, and the companyhas maintained adequate liquidity while using free cash flow toreduce debt." Despite weaker demand for beef in 2009 compared with2008, NBP effectively managed its cost structure and workingcapital to help grow its EBITDA and generate free cash flow overthe past two years. National Beef Inc., a holding company entityof NBP, has filed an IPO for up to $337 million. If completed,the company has indicated that a portion of proceeds would be usedto repay some of NBP's funded debt, including $27 million ofremaining balances on its senior unsecured notes due 2011.

Upon completion of the IPO, S&P will discuss with management thecompany's capital structure, liquidity, and strategy formaintaining operating stability in a difficult economy. AlthoughS&P will either raise or affirmed the ratings after its review,S&P could also withdraw the rating on the senior unsecured notesdue 2011 if that debt is fully repaid.

NATIONAL HOME: Files for Chapter 11 Bankruptcy----------------------------------------------National Home Centers Inc. filed for Chapter 11 bankruptcy as itattempts to renegotiate its debt to lender CIT Group Inc., WorthSparkman at arkansasbusiness.com reports. "We could not reach aresolve...It is our mission in life to pay our creditors but we'refrozen [for the time being,]" Company founder and chief executiveofficer Dwain Newman was quoted as stating.

Base in Springdale, National Home Centers Inc. supplies materialsto homebuilders in northwest and central Arkansas. The Companylisted assets and liabilities between $10 million and $50 millionin its petition.

NCI BUILDING: Reports $748.4 Million Fiscal Year Net Loss---------------------------------------------------------NCI Building Systems, Inc., reported a net loss of $103.6 millionfor the three months ended November 1, 2009, from net income of$24.6 million for the quarter ended November 2, 2008. The Companyreported a net loss of $748.4 million for the fiscal year endedNovember 1, 2009, from net income of $78.8 million for the fiscalyear ended November 2, 2008.

For the fourth quarter, sales were $244.4 million, up 2.5%sequentially from sales of $238.4 million in the 2009 thirdquarter, but down 52% from the $508.9 million reported for lastyear's fourth quarter. Gross margin was 24.8% compared to 25.6%in the prior quarter and 24.4% in last year's fourth quarter.

Sales were $967.9 million for the fiscal 2009 from $1.76 billionfor fiscal 2008.

Adjusted operating income exclusive of change in control chargesof $11.2 million, restructuring and impairment charges of $1.9million, and environmental and other contingencies of $1.1 millionwas $10.5 million compared to $11.5 million on the same basis inthe prior quarter and $54.0 million on the same basis in lastyear's fourth quarter. On a GAAP basis, the Company incurred anoperating loss for the 2009 fourth quarter of $3.7 millioncompared to operating income of $10.3 million in the prior quarterand $51.0 million in last year's fourth quarter.

Adjusted EBITDA, defined as earnings before interest, taxesdepreciation and amortization and other non-cash items inaccordance with our term loan credit agreement, was $18.5 millionfor the 2009 fourth quarter compared with $21.4 million in theprior quarter and $60.1 million in last year's fourth quarter. Inthe fourth quarter, the Company reported a net loss applicable tocommon shares of $115.3 million, or $3.59 per diluted share, whichincluded non cash debt extinguishment and refinancing costs of$99.2 million. Exclusive of these and other identified specialcharges, the net income applicable to common shares would havebeen $333,000, or $0.04 per diluted share.

In the prior quarter, NCI reported net income of $4.0 million or$0.20 per diluted share; net income in last year's fourth quarterwas $24.6 million or $1.26 per diluted share.

The weighted average number of common shares outstanding used inthe calculation of fourth quarter 2009 per share amounts was29,655,000, reflecting the partial period impact of the Company'srefinancing, which was completed on October 20, 2009. As part ofits refinancing, the Company acquired its existing convertiblenotes in exchange for approximately $90 million in cash and70.2 million of its common shares. At the end of the quarter,there were approximately 90.4 million shares of common stockoutstanding.

Inventory levels decreased 5.8% sequentially to $71.5 million from$75.9 million in the prior quarter. Measured in tons, inventoryon hand at the end of the fourth quarter was approximately 16%lower sequentially. Annualized inventory turnover was 10.1 turnsfor the fourth quarter, compared to 8.3 turns in the third quarterand 6.9 turns in the year-ago fourth quarter.

Net cash from operating activities was $20 million for the fourthquarter and $95.4 million for fiscal 2009. Capital expendituresin the fourth quarter were $3.8 million; full year 2009 capitalexpenditures were $21.7 million, inclusive of the $14.1 millioninvestment in NCI's new insulated panel plant. Fiscal 2010capital expenditures are expected to be between $10 million and$12 million.

The Company continues to evaluate the tax deductibility of certainrecapitalization transaction expenses. The Company expects thatthis review will be completed prior to the filing of its AnnualReport and may result in an additional tax benefit to the Company,ranging between $750,000 and $1.5 million.

At November 1, 2009, the Company had $613.4 million in totalassets against total current liabilities of $179.3 million,long-term debt of $135.4 million, deferred income taxes of$19.1 million, other long-term liabilities of $8.0 million, andSeries B cumulative convertible participating preferred stock of$222.8 million.

Recent Corporate Developments

On October 20, 2009, the Company announced the completion of itsrecapitalization transaction with Clayton, Dubilier & Rice, Inc.,managed funds. In addition to the $250 million equity investmentby the CD&R funds, NCI:

-- Refinanced its existing term loan by repaying approximately $143 million and modified the terms and maturity of the remaining $150 million of debt; and

-- Entered into a $125 million asset-based revolving credit facility, which remains undrawn.

"Through these transactions, NCI has gained the resources to rideout the economic downturn and re-start our growth strategy. CD&Ris widely respected as a long-term investor and business builderand brings both financial and operating resources to NCI," Mr.Chambers said. "Their significant investment is a strongendorsement of our business, growth strategy and our futureprospects."

Outlook

"Industry forecasts do not indicate any meaningful pick-up innonresidential construction activity in 2010," noted Mr. Chambers."Within what promises to be a continued difficult businessenvironment, we will focus on retaining and building upon ourmarket leadership positions through:

-- greater investment in technology and systems to support NCI's builder network while reducing costs and delivery times;

-- continuing to develop new products, and expanding NCI's end markets; and

Based in Houston, Texas, NCI Building Systems, Inc. (NYSE: NCS) isone of North America's largest integrated manufacturers of metalproducts for the nonresidential building industry. NCI iscomprised of a family of companies operating manufacturingfacilities across the United States and Mexico, with additionalsales and distribution offices throughout the United States andCanada.

NCI proposed a financial restructuring to address an immediateneed for liquidity in light of a potentially imminent defaultunder, and acceleration of, its existing credit facility, whichwas to occur as early as November 6, 2009 (which would have, inturn, lead to a default under, and acceleration of, its otherindebtedness, including the $180.0 million in principal amount of2.125% Convertible Senior Subordinated Notes due 2024, and thehigh likelihood that the Company would be required to repurchasethe convertible notes on November 15, 2009, the first scheduledmandatory repurchase date under the convertible notes indenture.

In October 2009, NCI Building and Clayton, Dubilier & Rice, Inc.on completed a $250 million equity investment in the Company byCD&R-managed funds. The CD&R-managed funds acquired newly issuedpreferred stock resulting in an ownership position in the Companyof roughly 68.5% on an as-converted basis.

NCI BUILDING: To Redeem 2.125% Convertible Sr. Sub Notes Due 2024-----------------------------------------------------------------NCI Building Systems, Inc., announced the expiration of its cashtender offer, commenced on November 9, 2009, to purchase itsoutstanding 2.125% Convertible Senior Subordinated Notes due 2024.The tender offer expired as of 11:59 p.m. New York City time onDecember 8, 2009. No holder of Notes has delivered any tenderpursuant to the tender offer.

NCI also announced its election to redeem the remaining principalamount of roughly $58,750 of its outstanding Notes. NCI expectsthe redemption to occur on December 29, 2009. The redemption ofand payment on the Notes will be made by The Bank of New YorkMellon Trust Company, N.A., the paying agent and the trustee ofthe indenture governing the notes, in accordance with terms andprocedures specified in the redemption notice. NCI will pay forthe Notes with cash on hand.

NCI will redeem the Notes at a redemption price in cash equal to100% of the principal amount of the Notes, together with accruedand unpaid interest on the Notes payable up to, but excluding, theRedemption Date.

In connection with the redemption, from December 9, 2009, untilthe close of business on December 28, 2009, each holder of Noteshas the right, at its option, to require NCI to convert theprincipal amount of the holder's Notes, or any portion of theprincipal amount of Notes that is a multiple of $1,000, into cashand fully paid shares of NCI's common stock in accordance with theterms, procedures and conditions outlined in the indenture for theNotes. As of December 9, 2009, the conversion rate for the Notesis 24.9121 shares of common stock per $1,000 in principal amountof the Notes. The closing price of NCI's common stock was $2.02on December 8, 2009.

The redemption is being made solely pursuant to a notice ofredemption dated December 9, 2009, which were mailed to theholders of the Notes by NCI. Copies of the notice of redemptionmay be obtained from The Bank of New York Mellon Trust Company,N.A., the trustee and paying agent for the Notes, by contactingthe trustee at: 601 Travis Street, 16th Floor, Houston, TX, 77002,Attention: Kash Asghar, (713) 483-6649.

About NCI Building

Based in Houston, Texas, NCI Building Systems, Inc. (NYSE: NCS) isone of North America's largest integrated manufacturers of metalproducts for the nonresidential building industry. NCI iscomprised of a family of companies operating manufacturingfacilities across the United States and Mexico, with additionalsales and distribution offices throughout the United States andCanada.

NCI proposed a financial restructuring to address an immediateneed for liquidity in light of a potentially imminent defaultunder, and acceleration of, its existing credit facility, whichwas to occur as early as November 6, 2009 (which would have, inturn, lead to a default under, and acceleration of, its otherindebtedness, including the $180.0 million in principal amount of2.125% Convertible Senior Subordinated Notes due 2024, and thehigh likelihood that the Company would be required to repurchasethe convertible notes on November 15, 2009, the first scheduledmandatory repurchase date under the convertible notes indenture.

In October 2009, NCI Building and Clayton, Dubilier & Rice, Inc.on completed a $250 million equity investment in the Company byCD&R-managed funds. The CD&R-managed funds acquired newly issuedpreferred stock resulting in an ownership position in the Companyof roughly 68.5% on an as-converted basis.

Moody's Investors Service downgraded Nelson Education Ltd.'scorporate family rating and probability of default rating to B3from B2 and also repositioned the company's ratings outlook tonegative from stable.

The CFR and PDR downgrades primarily result from expectations thatweak operational and financial performance as characterized byapproximately break-even free cash flow generation will continuefor the foreseeable future. The company has made little progressin growing revenues and expanding margins, and there is noexpectation of current nominal levels of free cash flow expandingmaterially during the near- to mid-term. Accordingly, the companyhas little ability in Moody's estimation of being able to repayits significant debt burden.

With that, and given the company's revolving credit facility comesdue in 2013 with the first lien term loan due a year later, it isnot too early to begin to consider execution risks related totheir refinancing. With the company's significant leverage andthe potential it could remain substantially unchanged, muchimproved credit market conditions may be required in order tofacilitate a refinancing of the unamortized residual of Nelson'sterm loan. The negative outlook signals the potential foradditional negative rating actions as the maturity of the termloan approaches.

With no sizable near-term debt maturities, break-even to modestfree cash flow generation and full access to its un-drawncommitted revolving credit facility, liquidity over the next fourquarters continues to be assessed as "good."

Moody's most recent rating action related to Nelson was taken on 3February 2009 at which time Moody's affirmed Nelson's B2 corporatefamily rating along with the stable outlook.

Nelson's ratings were assigned by evaluating factors Moody'sbelieves are relevant to the credit profile of the issuer, such asi) the business risk and competitive position of the companyversus others within its industry, ii) the capital structure andfinancial risk of the company, iii) the projected performance ofthe company over the near to intermediate term, and iv)management's track record and tolerance for risk. Theseattributes were compared against other issuers both within andoutside of Nelson's core industry and Nelson's ratings arebelieved to be comparable to those of other issuers of similarcredit risk.

New Energy Systems Group paid $33.7 million for the companyconsisting of $10.0 million in cash and the remaining$23.7 million by issuing approximately 3.6 million shares ofcommon stock based on an average stock price of $6.60 per share.

Anytone -- http://www.anytone.com.cn/-- manufactures and sells mobile power resources based on lithium ion batteries for a fullspectrum of products, including mobile phones, notebook computers,digital cameras, MP4s, PMPs, PDAs, solar and digital applications.Many of Anytone's products generate 4-7 times more power than theoriginal OEM battery's capacity. The company's power sourcessupport some of the best known products in the world, includingApple's iPod family of products. Anytone had 7 practical patentsand 23 appearance design patents by the State IntellectualProperty Office of the People's Republic of China (SIPO). Thecompany is also awaiting approval for its new innovation patent bySIPO. The company has also obtained CE, FCC, 3C, ROHS, UL andother certifications.

About New Energy Systems Group

With offices in New York and Shenzhen, China, New Energy SystemsGroup (OTCBB: NEWN) -- http://www.chinadigitalcommunication.com/-- manufactures and distributes lithium ion batteries. Thecompany assembles and distributes finished batteries through itssales network and channel partners. The company also sells high-quality lithium-ion battery shell and cap products to majorlithium-ion battery cell manufacturers in China. The company'sproducts are used to power mobile phones, MP3 players, laptops,digital cameras, PDAs, camera recorders and other consumerelectronic digital devices.

On November 17, 2009, China Digital obtained approval from FINRAto change its name to New Energy Systems Group. In conjunctionwith the name change, the company's CUSIP number was changed to643847106 and the stock began trading under the ticker symbol"NEWN" on November 18.

At September 30, 2009, the Company had $17,622,130 in total assetsagainst $3,197,717 in total liabilities, all current. AtSeptember 30, 2009, the Company had accumulated deficit of$4,660,858 and stockholders' equity of $14,424,413.

Going Concern

In its quarterly report on Form 10-Q, the Company said it believesit has sufficient cash to continue its current business throughSeptember 30, 2010, due to expected increased sales revenue andnet income from operations. "However we have suffered recurringlosses in the past and have a large accumulated deficit. Theseconditions raise substantial doubt about the Company's ability tocontinue as a going concern," the Company said.

The Company has taken certain restructuring steps to provide thenecessary capital to continue its operations. These steps included1) acquire profitable operations through issuance of equityinstruments, and 2) to continue actively seeking additionalfunding and restructure the acquired subsidiaries to increaseprofits and minimize the liabilities.

NII HOLDINGS: Moody's Upgrades Corporate Family Rating to 'B1'--------------------------------------------------------------Moody's Investors Service has upgraded NII Holdings', Inc.,Corporate Family and Probability of Default Ratings to B1 from B2.The upgrade was prompted by the company's strong operatingperformance during the currently weak economic environment and itsrecent success in acquiring new spectrum licenses as it expandsinto new markets and offers new services. In a related ratingaction Moody's assigned a B1(LGD3, 46%) rating to the proposedoffering of $500 million of guaranteed Senior Notes due 2019 to beissued by NII Capital Corp., a subsidiary of NII. The proposedoffering by NII Capital Corp. is expected to be used for generalcorporate purposes, including spectrum acquisitions, networkexpansion, deployment of new technologies and possibly therepurchase of some of the convertible notes issued by NII. Theoutlook is stable.

The upgrade to B1 is based on Moody's expectation that continuedstrong operating performance, a moderately leveraged capitalstructure (approximately 3.6x Moody's adjusted and pro forma forthe new issuance as of the LTM period ended Q3'09) and a healthyliquidity profile will provide the company with the financialflexibility to pursue its strategic objectives withoutsignificantly weakening its credit profile. Moody's believe thatmanagement is committed to maintaining a strong balance sheet asit recasts the business towards mobile broadband services over thenext few years. However, the B1 rating also reflects NII's smallsize and market position across its operating regions, thepresence of substantially larger, better funded competitorscapable of disrupting NII's niche market positions, and technologyrisk associated with the company's dependence on Motorola Inc.'sintegrated Digital Enhanced Network technology.

Moody's believes recent operating and financial results havedemonstrated the value of NII's brand and focus on customer care,the importance its subscribers place on access to Push-to-Talkservices and management's ability to successfully adapt to marketchallenges. Moody's notes that while NII's post-pay plans aretypically more expensive than those found in the pre-pay market,subscriber trends and churn improved materially in 3Q 2009 despiteongoing economic weakness and heightened competition, especiallyin its largest markets.

These ratings/assessments were affected by this action:

NII Holdings, Inc.:

-- Corporate Family Rating upgraded to B1 from B2 -- Probability of Default Rating upgraded to B1 from B2

NII Capital Corp.:

-- $800 million of 10.00% Senior Notes due August 15, 2016 affirmed at B1, but its loss given default assessment is changed to (LGD3, 46%) from (LGD3, 39%)

NII's credit metrics and liquidity position are consistent withhigher rated Telecom peers; however, Moody's believes thesemetrics are intermediate in nature. While the company is close tocompleting core network expansion in its largest markets and is inthe process of building out 3G networks in some of its smallermarkets, it will likely pursue spectrum acquisitions (especiallyin its two largest markets, Mexico and Brazil) to develop newservices and expand into new regions in an attempt to capitalizeon the healthy growth opportunities in Latin America. SinceMoody's believes that the investment associated with expansion inthese two large markets will be significant, Moody's do not expectthe company to reengage in shareholder-friendly financial policiesunless growth prospects diminish.

The stable outlook is based on Moody's expectation that NII willmaintain adjusted debt/EBITDA leverage below 4.0x over the ratinghorizon and that the company's operating performance, particularlychurn, will remain strong.

The last rating action was on August 7, 2009, at which timeMoody's assigned a first time B2 Corporate Family Rating to NIIHoldings, Inc.

The individual debt instrument ratings were determined usingMoody's Loss Given Default Methodology and reflect the expectedsize and positioning of the issuance within NII's capitalstructure.

With headquarters in Reston, Virginia, NII is an internationalwireless operator with subscribers in Mexico, Brazil, Argentina,Peru, and Chile. NII had over 7.0 million largely post-pay,business subscribers in those five countries and generated$4.2 billion in revenue for the LTM period ended Q309.

The Registration Statement and accompanying prospectus relate tothe resale, from time to time, of up to 58,745,592 shares of theCompany's common stock by stockholders. Of the total shares ofcommon stock offered in the prospectus, 37,649,442 are issuableupon conversion of shares of the Company's Series E PreferredStock and 21,096,150 are issuable upon the exercise of commonstock purchase warrants.

The selling stockholders will receive all of the proceeds from thesales. The Company will receive no part of the proceeds. TheCompany is paying the expenses incurred in registering the shares,but all selling and other expenses incurred by the sellingstockholders will be borne by the selling stockholders.

The Company's common stock is quoted on the OTC ElectronicBulletin Board of the National Association of Securities Dealers,Inc., under the symbol "NVLT.OB." On December 4, 2009, the lastreported sale price of the common stock on the OTC ElectronicBulletin Board was $0.75 per share.

At September 30, 2009, the Company had $5,996,461 in total assetsagainst total current liabilities of $7,408,800, deferred revenue-- noncurrent of $408,334, redeemable preferred stock of$20,381,810. At September 30, 2009, the Company had accumulateddeficit of $63,211,609 and stockholders' deficiency of$22,202,483.

Novelos Therapeutics said it will require additional capital tocontinue operations beyond the third quarter of 2010. NovelosTherapeutics noted the report from its independent registeredpublic accounting firm dated March 17, 2009 and included with itsannual report on Form 10-K indicated that factors existed thatraised substantial doubt about its ability to continue as a goingconcern.

About Novelos Therapeutics

Based in Newton, Massachusetts, Novelos Therapeutics, Inc. is adrug development company focused on the development oftherapeutics for the treatment of cancer and hepatitis. Novelosowns exclusive worldwide intellectual property rights (excludingRussia and other states of the former Soviet Union, but includingEstonia, Latvia and Lithuania) related to certain clinicalcompounds and other pre-clinical compounds based on oxidizedglutathione.

ORLEANS HOMEBUILDERS: 10-Q Delay Cues NYSE Non-Compliance Notice----------------------------------------------------------------Orleans Homebuilders, Inc., on December 1, 2009, received awritten notice from the NYSE Amex LLC stating that the Company isnot in compliance with the Exchange's continued listing criteriaset forth in Sections 134 and 1101 of the NYSE Amex LLC CompanyGuide because it failed to timely file its Quarterly Report onForm 10-Q for the period ended September 30, 2009. The writtennotice further stated that the failure to file the Form 10-Qconstitutes a material violation of the Company's listingagreement with the Exchange authorizing the Exchange to suspendand, unless prompt corrective action is taken, remove theCompany's common stock from the Exchange pursuant to Section1003(d) of the Company Guide.

In connection with the Company's failure to file its Form 10-K forthe fiscal year ended June 30, 2009, the Company submitted a planof compliance to the Exchange on November 16, 2009, advising theExchange of the actions the Company intended to take to bring theCompany into compliance with the applicable provisions of theCompany Guide by February 2, 2010. The plan of compliance alsoaddressed the Company's failure to file the Form 10-Q. TheCompany may, however, submit a revised plan of compliance with theExchange on or before December 15, 2009, advising the Exchange ofthe actions the Company intends to take to bring the Company intocompliance with the applicable provisions of the Company guide byFebruary 2, 2010.

The Company did not timely file its Form 10-K and Form 10-Q asthis would have required unreasonable effort and expense. TheCompany is working as expeditiously as possible to finalize itsaccounting and related disclosure for the periods covered by itsForm 10-K and Form 10-Q and currently expects to file the Form 10-K and currently expects to filed the Form 10-K and Form 10-Q inearly 2010. The Company can, however, offer no assurance that itwill file its Form 10-K or Form 10-Q at or before the timesprovided.

PEANUT CORP: Officers, Trustee Settle Defense Funds Dispute-----------------------------------------------------------Law360 reports that the Bankruptcy Court has approved a settlementbetween the trustee winding down Peanut Corp. of America and thecompany president and former officers, resolving a dispute over$1 million paid out by an insurance company for PCA's legaldefense costs.

Following a nationwide outbreak of Salmonella poisoning thatreports say sickened more than 700 people and killed nine, PeanutCorporation of America -- http://www.peanutcorp.com/-- filed a Chapter 7 bankruptcy petition in February 2009 (Bankr. W.D. Va.Case No. 09-60452). The Company estimated its assets andliabilities in the range of $1 million to $10 million at the timeof the filing.

PENN TRAFFIC: Court Pushes Base Price Hearing to December 15------------------------------------------------------------According to syracuse.com, the U.S. Bankruptcy Court in Wilmingtonmoved the hearing to set a base price for the sale of Penn TrafficCo. to a group led by some investment and liquidation firms toDec. 15, 2009, a week before the auction of the Company's assets.

PENN TRAFFIC: Inks Comprehensive Agency Pact with Liquidator Group------------------------------------------------------------------As reported in the Troubled Company Reporter on December 10, 2009,Penn Traffic Co. is liquidating 74 of 79 stores in going-out-of-business sales to commence by January and conclude by March 12. Agroup of liquidators, including affiliates of Gordon BrothersGroup LLC and Nassi Group LLC, will guarantee the Company willrecover at least $36.5 million, with $29.2 million paid before theGOB sale begins. If the sale produces enough to cover theguaranteed payment, the expenses of the sale and a $6.5 millionfee for the liquidators, the excess will be split evenly by PennTraffic and the liquidators.

The Liquidators' offer is subject to higher and betters offers atan auction on December 30. Initial competing bids are dueDecember 21. The sale hearing will be conducted promptlyfollowing the auction. The Bankruptcy Court will convene ahearing to consider approval of the proposed auction process.

As to the four remaining stores, Penn Traffic has an agreement tosell the stores to competitor Price Chopper Operating Co., Inc.for $12.3 million plus assumption of specified liabilities.

The Company is being forced to sell the assets by the first- andsecond-lien lenders who were otherwise cutting off the continuedright to use cash. The first lien agent is represented by PaulHastings, Janofsky & Walker, LLP. Greenberg Traurig, LLP,represents the second lien agent.

PILGRIM'S PRIDE: Judge Lynn to Confirm Chapter 11 Plan------------------------------------------------------Judge D. Michael Lynn of the U.S. Bankruptcy Court in the NorthernDistrict of Texas, Fort Worth Division, said, at the culminationof the December 8, 2009 hearing to consider confirmation of thePlan of Reorganization of Pilgrim's Pride Corporation and itsdebtor affiliates, that he will confirm the plan once someprovisions are resolved.

The Plan contemplates for the Debtors' emergence from bankruptcywith at least $1,650,000,000 in available financing and that JBSUSA Holdings, Inc., the Plan Sponsor, will purchase 64% of thecommon stock of the Reorganized PPC in exchange for $800 millionin Cash, to be used by the Reorganized Debtors to, among otherthings, fund distributions to holders of Allowed Claims.Shareholders will be entitled to purchase the remaining 36% ofthe Reorganized PPC common stock.

Prior to the Confirmation Hearing, on December 4, 2009, theDebtors submitted to Judge Lynn an Amended Plan of Reorganizationreflecting amendments with respect to these matters:

(1) Exit facility. The amount of the Exit Facility is increased from $1.650 billion to an amount up to $1.750 billion.

(2) Treatment of Priority Tax Claims. Under the Amended Plan, each holder of an Allowed Priority Tax Claim will receive Cash in an amount equal to the Allowed Priority Tax Claim, including any interest on the Allowed Priority Tax Claim required to be paid pursuant to the Bankruptcy Code from the late of the Petition Date and the date the relevant tax becomes past due through the later of the Effective Date and the date on which the Priority Tax Claim will become an Allowed Priority Tax Claim;

(3) Distribution of Allowed Secured Tax Claims. Under the Amended Plan, except to the extent that a holder of an Allowed Secured Tax Claim has been paid by the Debtors prior to the Effective Date or agrees to a less favorable treatment, each holder will receive Cash in an amount equal to the Allowed Secured Tax Claim, including any interest on the Allowed Secured Tax Claim required to be paid pursuant to the Bankruptcy Code from the late of the Petition Date and the date the relevant tax becomes past due through the later of the Effective Date and the date on which the Secured Tax Claim will become an Allowed Secured Tax Claim;

(4) Releases related to Claims and Equity Interests. The Amended Plan releases the Debtor, the Reorganized Debtor and "Protected Person" from all claims and causes of action that exist as of the Effective Date and arise from the Claim or Equity Interest of that holder.

"Protected Persons" means (a) the present and former directors, officers, employees, affiliates, agents, financial advisors, investment bankers, attorneys, and representatives of the Debtors, including the Chief Restructuring Officer, (b) the Committees, (c) the agents and lenders under the Prepetition BMO Credit Agreement, (d) the agents and lenders under to the Prepetition CoBank Credit Agreement, (e) the agents and lenders under the DIP Credit Agreement, (f) Pilgrim Interests, Ltd., solely in its capacity as guarantor under the Guarantee Agreements, (g) the Plan Sponsor, and (h) their present and former directors, officers, employees, affiliates, agents, financial advisors, investment bankers, attorneys, and representatives.

(5) Releases of Indemnified Protected Persons. On the Effective Date, and in consideration for the obligations of the Debtors and the Reorganized Debtors under the Plan, each person or entity that has a claim or cause of action (i) against any Protected Person having a right to seek indemnification or contribution, whether pursuant to common law or otherwise, from the Debtors, (ii) that is not otherwise released pursuant to Section 10.8(a) of the Amended Plan and (iii) with respect to which there is insurance coverage, regardless of amount, will release and discharge unconditionally and forever that Indemnified Protected Person from any and all claims and causes of action that exist as of the Effective Date relating to the Debtors, the Debtors' estates, or the Chapter 11 Cases and will seek payment of that claim or cause of action solely from the applicable insurance polic(ies).

(6) Optional releases. On the Effective Date, and in consideration for the obligations of the Debtors and the Reorganized Debtors under the Plan, each person or entity that has a claim or cause of action against any Protected Person that is not otherwise released pursuant to Section 10.8(a) of the Plan will have an option, subject to entry, without further court approval, into an appropriate stipulation with the Debtors or the Reorganized Debtors, as applicable, to (i) if there is no applicable insurance coverage, file a Proof of Claim against the Debtors relating to that person or entity's claim or cause of action, which proof of claim will be resolved and paid pursuant to the terms of the Plan, and unconditionally and forever release that claim or cause of action against the relevant Protected Person, or (ii) if there is applicable insurance coverage, seek payment of the claim or cause of action solely from the applicable insurance policy and unconditionally and forever release any and all claims or causes of action against the relevant Protected Person, Debtors and Reorganized Debtors.

(7) Claims of governmental units. Nothing in the Plan or the Confirmation Order will operate as a waiver of or a release or exculpation of any claim or cause of action (x) held by a Governmental unit against any non-Debtor or (y) held by a Governmental Unit against any Debtor, other than those Claims of any Governmental Unit that are subject to the deadlines established by the Bar Date Order or order on the requests for payment of administrative expenses. Nor will anything in the Plan or the Confirmation Order enjoin any Governmental Unit from bringing any claim, suit, action, or other proceeding against any party or person for liability under any Non-Released Government Claim. For the avoidance of doubt, a Governmental Unit includes, as examples, and without limitation, the Food Safety and Inspection Service, the Grain Inspection, Packers and Stockyards Administration, the Agriculture Marketing Service, and the Food and Nutrition Service of the United States Department of Agriculture.

The Debtors also filed a Memorandum of Law maintaining that theirPlan is confirmable. The Debtors have acknowledged theobjections of certain entities to the Amended Plan. In order toaddress certain of the objections, the Debtors have mademodifications to the Plan. The Debtors state further that theAmended Plan has responded more fully to certain of the legal andfactual arguments raised in the Objections that the Debtors havenot yet resolved. The Debtors submit further that the AmendedPlan satisfies all of the confirmation requirements of Section1129 of the Bankruptcy Code, thus, the Amended Plan should beconfirmed and the objections overruled.

The Debtors also supplemented their Amended Plan with newexhibits to the Plan Supplement containing (i) an amended list ofExecutory Contracts and Unexpired Leases to be assumed, (ii) anamended list of Officers of the Reorganized Debtors, (iii) anamended list of the Initial Directors of the Reorganized Debtors.

The Debtors also included their Annual Report for the fiscal yearended September 26, 2009 as an addition to the Amended PlanSupplement. A full-text copy of the Amended Plan Supplement isavailable for free at:

The Official Committee of Unsecured Creditors informs the Courtthat it supports the Debtors' Amended Plan, and submits that thePlan should be confirmed.

Similarly, the Debtors' Chief Restructuring Officer, WilliamSnyder, believes that the Liquidation Analyses are based on soundassumptions, and provide a reasonable estimate of the liquidationvalues upon conversion of the Chapter 11 Cases to a case underchapter 7 of the Bankruptcy Code. Pursuant to these analyses,Mr. Snyder believes that the Debtors determined that confirmationof the Plan will provide holders of Allowed Class 10(a) EquityInterests a recovery that is equal to or greater than members ofthat Class would receive pursuant to a chapter 7 liquidation ofeach Debtor or consolidated Debtors. In this regard, Mr. Snydermaintains that confirmation of the Plan is appropriate, is in thebest interests of all parties in interest and should, thus, begranted.

Plan Gets Overwhelming Support

The Debtors' voting and solicitation agent, Kurtzman CarsonConsultants, filed a report with the Court showing that theDebtors received overwhelming support from holders of Class 10(a)which is the only Class entitled to vote on the Plan.

More than 90% of ballots submitted by holders of Class 10(a)Claims were cast in favor of the Plan.

KCC was also requested to determine the voting results if theshares controlled by "insiders" were not included in theTabulation. KCC identified the Pilgrim family as the only"insiders" that properly voted. KCC identified the Pilgrimfamily shares by reviewing the records provided by the Bank ofNew York Mellon, as transfer agent.

A total of 25,814,120 shares were identified as Pilgrim Familyshares, of which 25,789,164 were represented by timely submittedballots.

KCC presented a summary of the voting results with respect to theVoting Securities Class if votes of "insiders" are not counted:

On behalf of Black Horse, Catherine L. Steege, Esq., at Jenner &Block LLP, in Chicago, Illinois, points out that the only classimpaired by, and thus entitled to vote on, the Plan is Class10(a) Equity Interests in the Debtors, of which Black Horse is amember.

Black Horse expects, however, that the Debtors will contend thatthe Plan has been accepted by Class 10(a) almost entirely due tothe votes by Insiders controlling a majority of the shares of theDebtors, Mr. Steege relates. These Insiders have been offeredvarious incentives, and therefore clearly have motives, which areulterior to and different from the motives and incentives facingordinary non-insider shareholders, she avers.

The short time frame for the exchange could have a "depressingeffect" on the value of Pilgrim's Pride's stock because theshares would be sold before the company is "sufficiently far outof bankruptcy," Mark MacDonald, Esq., an attorney for Black Hors,told Dow Jones.

Mr. MacDonald said the Pilgrim family, which owns the majority ofthe company's stock, will benefit from the plan through continuedemployment. He pointed out that Mr. Bo Pilgrim is slated tocollect $7.5 million in fees over the next five years as aconsultant to JBS. Senior Vice President Lonnie Ken Pilgrimwould continue to draw a more than $250,000 a year for his workat the company, Mr. McDonald added.

Judge Lynn, however, rejected Black Horse's argument that the$7.5 million to be paid to "Bo" Pilgrim should be available toall shareholders, Dow Jones related. "The fact that JBS enteredinto a transaction with Mr. Pilgrim should not affect" whether aplan should be approved by the court, Judge Lynn ruled, asreported by Dow Jones.

The Debtors objected to Black Horse's motion contending that theDebtors' balloting agent identified the Pilgrim family shares byreviewing the records of the Bank of New York Mellon, as transferagent. KCC found that even if excluding the votes of the Pilgrimfamily, 81.67% of Class 10(a) voted to accept the Plan, which ismore than the required two-thirds vote under Section 1129 of theBankruptcy Code, Stephen A. Youngman, Esq., at Weil, Gotshal &Manges LLP in Dallas, Texas said.

Therefore, the Debtors contend that the Motion is moot.Proceeding with the Motion would be a waste of estate resourcesand the Court's time, Mr. Youngman asserted.

The judge did say that he wouldn't immediately approve releasesfor Pilgrim's Pride executives, attorneys and lenders, Dow Jonesrelated. Judge Lynn, according to the report, said he would"more narrowly tailor" the release provision of the bankruptcyplan and issue a written opinion.

Pilgrim's Pride Corp. and six other affiliates filed Chapter 11petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No.08-45664). The Debtors' operations in Mexico and certainoperations in the United States were not included in the filingand continue to operate as usual outside of the Chapter 11process.

As of December 27, 2008, the Company had US$3,215,103,000 in totalassets, US$612,682,000 in total current liabilities,US$225,991,000 in total long-term debt and other liabilities, andUS$2,253,391,000 in liabilities subject to compromise.

PILGRIM'S PRIDE: Addresses Plan Confirmation Objection------------------------------------------------------Prior to the confirmation hearing, various parties submittedobjections to the confirmation of the reorganization plan ofPilgrim's Pride Corp.

William T. Neary, the United States Trustee for Region 6 askedthat the "No Government Release" language be included in theConfirmation Order. Holders of various notes issued by theDebtors also objected. Black Horse Capital Management LLC and itsaffiliates, owners of more than 3,000,000 shares of the Debtors'common stock and holders of the Debtors' 8-3/8 Senior SubordinatedNotes, said the Plan is not proposed in good faith and is not fairand equitable to holders of the Debtors' common stock. Variouslessors including Bank of America Leasing & Capital, LLC,objected to the Plan in connection with the terms of theassumption of their contracts.

Plaintiffs Jennifer Hall and Jose Rocha in the RICO Action filedin the United States District Court for the Northern District ofAlabama, Northwestern Division on March 16, 2007, against twoemployees of the Debtors' Russelville, Alabama processing plant,pointed out that the Plan ontains certain objectionable releaseand injunction provisions.

Taxing Authorities that include The Fort Worth Independent SchoolDistrict and the Arlington Independent School District taxingunits object to the confirmation of the Plan to the extent thatthe plan treats the Taxing Units' claim as anything other than asecured claim.

Certain growers that include The Arkansas Growers asked the Courtto deny confirmation of the Plan because it does not comply withSection 502(c) of the Bankruptcy Code, which authorizes estimationof claims in bankruptcy. The Growers also complain that theirinterests are impaired because (i) the overbroad releasescontemplated by the Plan deprive the Growers of legal rights towhich they would otherwise be entitled, and (ii) the lack of areserve to ensure payment of the Growers' claims subjects them torisks and to expense not present for other Class 7 creditors.

FMC Corporation, a vendor and provider of salmonella controlservices to the Debtors under the Spectrum Supply Contract,stands against the confirmation of the Debtors' Plan ofReorganization unless the Debtors specify their intentions toassume or reject the Spectrum Supply Contract.

Debtors' Response to Confirmation Objections

The Debtors' counsel, Stephen A. Youngman, Esq., at Weil, Gotshal& Manges LLP, in Dallas, Texas, tells the Court that although theDebtors have been able to resolve, or believe that they haveresolved, a number of Plan confirmation objections and cureamount objections, other Plan Objections and Cure AmountObjections remain unresolved.

The Debtors, Mr. Youngman says, intend to address any unresolvedPlan Objection at the hearing to confirm the Plan. Anyunresolved Cure Amount Objections, however, will be adjourned tothe next available omnibus hearing date.

For reasons stated in a table prepared by the Debtors to addresseach Plan Objection and Cure Amount Objection, the Debtors askthe Court to overrule the Plan Objections to the extent they havenot already been withdrawn or resolved.

A full-text copy of the table of the objections and the Debtors'response to each of their objections is available for free at:

Pilgrim's Pride Corp. and six other affiliates filed Chapter 11petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No.08-45664). The Debtors' operations in Mexico and certainoperations in the United States were not included in the filingand continue to operate as usual outside of the Chapter 11process.

As of December 27, 2008, the Company had US$3,215,103,000 in totalassets, US$612,682,000 in total current liabilities,US$225,991,000 in total long-term debt and other liabilities, andUS$2,253,391,000 in liabilities subject to compromise.

PILGRIM'S PRIDE: Gets Jan. 31 Extension of DIP Loans----------------------------------------------------Pilgrim's Pride Corp. and its units obtained the Court's authorityto enter into the Fourth Amendment to the Amended and RestatedPostpetition Credit Agreement by and among the Debtors, the DIPLenders, and Bank of Montreal.

The DIP Credit Agreement and the Debtors' use of Cash Collateralcurrently expire on December 1, 2009 -- before the currentlyscheduled December 8, 2009 Confirmation Hearing, thusnecessitating an extension of the term of the DIP CreditAgreement and the use of Cash Collateral, Martin A. Sosland,Esq., at Weil, Gotshal & Manges, LLP, in Dallas, Texas, asserts.

Mr. Sosland states that although the Debtors believe that theProposed Plan of Reorganization will be confirmed and will besubstantially consummated before the end of December 2009, out ofabundance of caution, the Debtors are seeking an extension of thematurity of the DIP Credit Agreement and the use of CashCollateral through the earlier of January 31, 2010, and certainother termination events.

Mr. Sosland tells the Court that certain DIP Lenders -- BMO,Cooperatieve Centrale Raiffeisen-Boerenleenbank B.A., U.S. BankNational Association, and ING Capital LLC -- have agreed to amendthe Credit Agreement to accommodate the Debtors' request withoutany further monetary consideration being provided to the DIPLenders in exchange for the amendment.

In addition, in connection with the amendment, the Debtors haveasked that the DIP Lenders permanently reduce the DIP Commitmentsto $250,000,000. In connection therewith, the Continuing Lenderscommitted to extend these amounts of DIP Loans to the Debtors:

Wells Fargo Bank National Association, Calyon New York Branch,Natixis New York Branch, SunTrust Bank, and First National Bankof Omaha also consent to the Fourth DIP Financing Amendment andagree that from and after the effective date of the FourthAmendment, they will cease to be Lenders under the DIP CreditAgreement.

Pilgrim's Pride Corp. and six other affiliates filed Chapter 11petitions on December 1, 2008 (Bankr. N.D. Tex. Lead Case No.08-45664). The Debtors' operations in Mexico and certainoperations in the United States were not included in the filingand continue to operate as usual outside of the Chapter 11process.

As of December 27, 2008, the Company had US$3,215,103,000 in totalassets, US$612,682,000 in total current liabilities,US$225,991,000 in total long-term debt and other liabilities, andUS$2,253,391,000 in liabilities subject to compromise.

PLIANT CORP: Emerges From Bankruptcy as Berry Plastics Unit-----------------------------------------------------------Berry Plastics Corporation said December 3, 2009, it has completedthe acquisition of 100% of the common stock of Pliant Corporationfor an acquisition purchase price of $561 million.

Pliant emerged from bankruptcy effective December 3, 2009, andbecame a wholly owned direct subsidiary of Berry. The acquisitionwas funded with the proceeds from the private placement of notesin October. As reported by the Troubled Company Reporter, BerryPlastics on October 29, 2009, said it would issue, through its twonewly formed, wholly owned subsidiaries:

-- $370 million of first priority senior secured notes due 2015; and

-- $250 million of second priority senior secured notes due 2014.

The First Priority Notes will bear interest at a rate of 8-1/4%payable semiannually, in cash in arrears, on May 15 andNovember 15 of each year, commencing May 15, 2010 and will matureon November 15, 2015.

The Second Priority Notes will bear interest at a rate of 8-7/8%payable semiannually, in cash in arrears, on March 15 andSeptember 15 of each year, commencing March 15, 2010, and willmature on September 15, 2014.

The newly acquired business will be operated as Berry's SpecialtyFilms Division and will be run by R. David Corey, the former ChiefOperating Officer of Pliant. Berry's current Flexible FilmsDivision will now be known as the Film Products Division.

A full-text copy of Berry's disclosure on Form 8-K filed with theSecurities and Exchange Commission is available at no charge at:

Headquartered in Schaumburg, Illinois, Pliant Corporation producesvalue-added film and flexible packaging products for personalcare, medical, food, industrial and agricultural markets. Pliantoperates 16 manufacturing facilities around the world, and employsapproximately 2,800 people with annual net sales of $900 millionfor the 12 months ended September 30, 2009. Barclays Capitalacted as the exclusive financial advisor to Apollo Management,Graham Partners and Berry Plastics in conjunction with the Pliantrestructuring process.

Pliant and 10 of its affiliates filed for Chapter 11 protection onJanuary 3, 2006 (Bankr. D. Del. Lead Case No. 06-10001). James F.Conlan, Esq., at Sidley Austin LLP, and Edmon L. Morton, Esq., andRobert S. Brady, Esq., at Young, Conaway, Stargatt & Taylor,represented the Debtors in their restructuring efforts. TheDebtors tapped McMillan Binch Mendelsohn LLP, as Canadian counsel.As of September 30, 2005, the Company had $604.3 million in totalassets and $1.19 billion in total debts. The Debtors emergedfrom Chapter 11 on July 19, 2006.

Pliant Corp. and its affiliates again filed for Chapter 11 afterreaching terms of a pre-packaged restructuring plan. Thevoluntary petitions were filed February 11, 2009 (Bank. D. Del.Case Nos. 09-10443 through 09-10451). The Hon. Mary F. Walrathpresides over the cases. Jessica C.K. Boelter, Esq., at SidleyAustin LLP, in Chicago, Illinois, and Edmon L. Morton, Esq., atRobert S. Brady, Esq., at Young Conaway Stargatt & Taylor, LLP, inWilmington, Delaware, provide bankruptcy counsel to the Debtors.Epiq Bankruptcy Solutions LLC acts as claims and noticing agent.The U.S. Trustee for Region 3 appointed five creditors to serve onan official committee of unsecured creditors. The CreditorsCommittee selected Lowenstein Sandler PC as its counsel. As ofSeptember 30, 2008, the Debtors had $688.6 million in total assetsand $1.03 billion in total debts.

About Berry Plastics

Berry Plastics Corporation manufactures and markets plasticpackaging products, plastic film products, specialty adhesives andcoated products. At June 27, 2009 the Company had 64 productionand manufacturing facilities, with 58 located in the UnitedStates. Berry is a wholly-owned subsidiary of Berry PlasticsGroup, Inc. Berry Group is primarily owned by affiliates ofApollo Management, L.P. and Graham Partners. Berry, through itswholly owned subsidiaries operates in four primary segments: RigidOpen Top, Rigid Closed Top, Flexible Films, and Tapes/Coatings.The Company's customers are located principally throughout theUnited States, without significant concentration in any one regionor with any one customer.

At September 26, 2009, the Company had total assets of$4.401 billion against total liabilities of $4.079 billion,resulting in stockholders' equity of $321.7 million. BerryPlastics reported a net loss of $26.2 million for the fiscal yearended September 26, 2009, from a net loss of $101.1 million forfiscal year ended September 27, 2008, and net loss of$116.2 million for fiscal year ended September 27, 2008.

* * *

As reported by the Troubled Company Reporter on June 10, 2009,Standard & Poor's Ratings Services raised its corporate creditrating on Berry Plastics Group to 'B-' from 'SD' and the seniorunsecured debt rating to 'CCC' from 'D'. The recovery ratings onGroup's senior unsecured debt remain unchanged at '6', indicatingS&P's expectation for negligible recovery (0% to 10%) in a paymentdefault. S&P affirmed all its ratings on Group's wholly ownedoperating subsidiary Berry Plastics Corp. The outlook is stable.

PLUG POWER: Receives NASDAQ Non-Compliance Notice-------------------------------------------------Plug Power Inc. disclosed that it received a notice on December 8,2009 from the NASDAQ Stock Market. The notice stated that theCompany was not in compliance with NASDAQ Marketplace Rule5450(a)(1) because the bid price of the Company's common stockclosed below the required minimum $1.00 per share for the previous30 consecutive business days. The NASDAQ notice has no immediateeffect on the listing of the Company's common stock.

In accordance with NASDAQ rules, Plug Power has a period of 180calendar days, until June 7, 2010, to regain compliance with theminimum bid price rule. If at any time before June 7, 2010, thebid price of the Company's common stock closes at $1.00 per shareor more for a minimum of 10 consecutive business days, NASDAQ willnotify the Company that it has regained compliance with theminimum bid price rule.

In the event the Company does not regain compliance with the Ruleprior to the expiration of the 180-day period, NASDAQ will notifythe Company that its securities are subject to delisting.However, the Company may appeal the delisting determination to aNASDAQ hearing panel and the delisting will be stayed pending thepanel's determination. At this hearing, the Company would presenta plan to regain compliance and NASDAQ would then subsequentlyrender a decision. The Company is currently evaluating itsalternatives to resolve the listing deficiency.

On September 30, 2009, Plug Power had cash, cash equivalents andavailable-for-sale securities of $71.1 million and net workingcapital of $70.4 million.

About Plug Power Inc.

Plug Power Inc. -- http://www.plugpower.com/-- is an established leader in the development and deployment of clean, reliable energysolutions, integrates fuel cell technology into motive andcontinuous power products. The Company is actively engaged withprivate and public customers in targeted markets throughout theworld.

PROTOSTAR LTD: SES Offers $185MM Cash for Protostar II------------------------------------------------------Bill Rochelle at Bloomberg News reports that an affiliate of SESSA has a contract to buy ProtoStar Ltd.'s ProtoStar II satellitefor $185 million cash, absent higher and better bids at an auctionon December 16. If the proposed revised auction procedure isapproved, SES will be the stalking horse bidder at the auction.Competing bids would be due December 14. The sale hearing will beon December 18, two days following the auction. ProtoStar says itexpects the auction will be "competitive." The ProtoStar IIsatellite was launched in May and became operational in June.

As reported by the TCR on Nov. 12, ProtoStar has won approval tosell the ProtoStar I satellite and related equipment for $210million to an affiliate of Intelstat Holdings Ltd.

The Official Committee of Unsecured Creditors has a suit pendingwhere it contends secured lenders don't have valid liens securingaUS$10 million working capital loan and US$183 million in 12.5%and 18% secured notes. The creditors believe the noteholders andworking capital lenders filed notices of their security interestsin the wrong place, as a result invalidating their liens. If theCreditors Committee wins the lawsuit, the lenders would have anunsecured creditor status and they won't be paid ahead of othercreditors.

About ProtoStar Ltd.

Hamilton, HM EX, Bermuda-based ProtoStar Ltd. is a satelliteoperator formed in 2005 to acquire, modify, launch and operatehigh-power geostationary communication satellites for direct-to-home satellite television and broadband internet access across theAsia-Pacific region.

The Company and its affiliates filed for Chapter 11 on July 29,2009 (Bankr. D. Del. Lead Case No. 09-12659.) The Debtor selectedPachulski Stang Ziehl & Jones LLP as Delaware counsel; Law Firm ofAppleby as their Bermuda counsel; UBS Securities LLC as financialadvisor & investment banker and Kurtzman Carson Consultants LLC asclaims and noticing agent. The Debtors have tapped UBS SecuritiesLLC as investment banker and financial advisor. In theirpetition, the Debtors listed between US$100 million and US$500million each in assets and debts. As of December 31, 2008,ProtoStar's consolidated financial statements, which include non-debtor affiliates, showed total assets of US$463,000,000 againstdebts of US$528,000,000.

At September 30, 2009, the Company had $26,160,438 in total assetsagainst $4,927,694 in total liabilities. The September 30 balancesheet showed strained liquidity: The Company had $246,048 in totalcurrent assets against $2,950,658 in total current liabilities.

Going Concern Qualification

On April 15, 2009, Radient Pharmaceuticals (formerly AMDL, Inc.)filed with the SEC an Annual Report on Form 10-K in which includedan audit opinion with a "going concern" explanatory paragraphwhich expresses doubt, based upon current financial resources, asto whether AMDL can meet its continuing obligations without accessto additional working capital.

RADLAX GATEWAY: Court to Consider Transfer of Case on December 23-----------------------------------------------------------------The Hon. A. Benjamin Goldgar of the U.S. Bankruptcy Court for theNorthern District of Illinois will consider Bomel ConstructionCo., Inc.'s motion to transfer the Chapter 11 cases of RadLAXGateway Hotel, LLC, et al. on December 23, 2009, at 10:30 a.m.

As reported in the Troubled Company Reporter on Nov. 18, 2009,creditor Bomel asked the Court to transfer the Debtors cases tothe Central District of California. Bomel wanted the casetransferred in the interest of justice and the convenience of theparties.

RANCHER ENERGY: Court Okays New Month to Month Lease with Landlord------------------------------------------------------------------In a regulatory filing Monday, Rancher Energy Corp. discloses thaton December 3, 2009, the Bankruptcy Court approved the month tomonth lease between the Company and its landlord, LBA Realty FundIII - Company III, LLC, whereby the Company agrees to pay $5,000per month. The order also canceled the original lease enteredinto by the Company in 2006.

Rancher Energy Corp., aka Rancher Energy Oil & Gas Corp., fkaMetalix, Inc., develops and produces oil in North America.It operates three fields, including the South Glenrock B Field,the Big Muddy Field, and the Cole Creek South Field in the PowderRiver Basin, Wyoming in the Rocky Mountain region of the UnitedStates. The Company was formerly known as Metalex Resources, Inc.and changed its name to Rancher Energy Corp. in April 2006.Rancher Energy Corp. was founded in 2004 and is headquartered inDenver, Colorado.

S & K FAMOUS: Court Confirms Plan; Unsec. Claims Get 6% Recovery----------------------------------------------------------------S&K Famous Brands Inc. received an order from the Bankruptcy Courtconfirming its proposed Chapter 11 plan. The Debtor and theOfficial Committee of Unsecured Creditors have sponsored aliquidating Chapter 11 plan that offers (i) holders of secured,perfected consignment and other priority claims a 100% recovery oftheir claims, (ii) holders of general unsecured claims, totaling$34.9 million with a recovery on up to six cents on the dollar and(iii) holders of convenience claims with a 10% recovery.

The Company recorded revenue of C$7,049,000 in fiscal 2009,C$6,998,000 in fiscal 2008, C$6,729,000 in fiscal 2007,C$5,477,000 in fiscal 2006 and C$6,096,000 in fiscal 2005.

As of July 31, 2009, the Company had total assets of C$2,740,000against total liabilities of C$5,113,000, resulting inshareholders' deficit of C$2,373,000. As of July 31, 2009, theCompany had a negative Working Capital of C$363,000, from positiveworking capital the past four years: C$85,000 in fiscal 2008,C$238,000 in fiscal 2007, C$1,852,000 in fiscal 2006 andC$5,820,000 in fiscal 2005.

According to the Company, in light of operating losses suffered inthe current and past years, its ability to realize its assets anddischarge its liabilities depends on the continued financialsupport of its shareholders and debenture holders, its ability toobtain additional financing and its ability to achieve revenuegrowth. The Company said it is executing a business plan to allowit to continue as a going concern which is to continue to searchfor additional sources of debt and equity financing, and achieveprofitability through cost containment and revenue growth. Therecan be no assurance that the Company's activities will besuccessful.

On October 28, 2009, SAND Technology Co-Founder and ChiefExecutive, Arthur Ritchie, said that on reaching the age of 65, heplans to retire and step down as CEO by the end of October. Heagreed to remain as the company's Chairman working in an advisorycapacity. Additionally he will focus on assisting the CEO'ssmooth transition including strengthening existing customer andpartner relationships.

Tom O'Donnell, current board member and a major shareholder ofSAND, was appointed as President and CEO effective November 1,2009. Mr. O'Donnell is the CEO and founder of Edge Specialists --an independent software vendor of derivative trading tools. He isa co-inventor of two extensive trading software patents, a C.P.A.and a graduate of Harvard Business School. His extensive careerin the software and financial markets makes him highly qualifiedfor his new role.

Together with approximately $400 million in common and preferredstock offerings, note proceeds will fund SD's pending $800 millionacquisition of Permian Basin oil and gas properties from ForestOil. Though the acquisition comes at a very high cost per currentdaily flowing barrel of oil equivalent, the acquisition fundingmix adequately mitigates risk to bondholders at the currentratings.

Approximately 46% of SD's estimated 80 mmboe of acquired provenreserves is proven developed. SD is paying an extremely high$105,000/Boe per flowing daily Boe of production for Forest's oil-weighted Permian Basin properties, believing that it hasidentified 1,500 qualified drilling locations. In paying a lessextreme $22.72/Boe of PD reserves, it appears that the producingportion of the properties contains a very large proportion of lowproductivity wells late in their decline curves. Theapproximately 1,000 producing wells on the property do in factaverage a low roughly 7.6 Boe of daily production per well.

However, the ratings are supported by an improved asset mix. Theacquisition intensifies SD's existing Permian oil-weightedactivity in the Central Basin Platform and adds importantdiversification of production and reserve replacement risk to SD'sasset mix. In particular, the acquisition takes some pressure offof SD's core Pinon Field program in the West Texas Overthrust Beltto drive production replacement and growth. It also boosts oiland natural gas liquids up from 17% to 26% of production. Thecompany remains well hedged, with approximately 75% of expected2010 production hedged at an attractive $8.90/Mcfe, protectingSD's 2010 capital program.

Nevertheless, SD remains very highly leveraged and it willsignificantly outspend 2010 cash flow for drilling anddevelopment. Organic leverage reduction would be restricted tothe degree to which production and PD reserves grow faster thandebt with successful productive drilling. SD will need to beginreversing two consecutive quarters of production decline arisingfrom curtailed 2009 drilling activity and a production bottleneckin the Pinon Field that will exist until the Century gasprocessing plant is completed to treat SD's CO2-laden Pinonnatural gas production.

Moody's estimates that the acquisition cost, loaded for futurecapital spending needed to bring the acquired proven undevelopedand PDNP reserves to production, equates to approximately $15/boeto $16/boe in outlays for the acquired total proven reserves.Including 75% of the preferred stock as debt, Moody's estimatepro-forma leverage of $14.98/Boe on PD reserves and an extremelyhigh $54,555/Boe of daily production. Excluding the preferredshares from leverage, leverage on PD reserves would beapproximately $13/Boe and leverage on daily production would beapproximately $48,000/Boe. Leverage on PD reserves remainssubstantially unchanged but leverage on production increasesapproximately 7% over third quarter 2009 levels.

Downside risk could result if SD's drilling programs under-perform, if SD fails to substantially reduce leverage over thecourse of 2010, or it otherwise materially boosts leverage in themeantime as measured on production PD and total reserves.

After a sustained period of negligible reinvestment by Forest, SDbelieves the properties and identified drilling locations willreadily respond commercially to drilling capital and acomparatively large drilling program. SD estimates that initialproduction per new well would average 124 Boe per day, thoughsubsequently decline steeply by an average of 60% in the firstyear of production. This will require substantial sustainedannual drilling on the properties to hold production steady orgenerate growth.

SANDRIDGE ENERGY: S&P Raises Corporate Credit Rating to 'B+'------------------------------------------------------------Standard & Poor's Ratings Services said that it raised itscorporate credit rating on SandRidge Energy Inc. to 'B+' from 'B'.S&P removed the ratings from CreditWatch where they were placed onDec. 2, 2009, with positive implications, following SandRidge'sannouncement that it intends to purchase $800 million of oil andgas properties from Forest Oil Corp. (BB-/Stable/--). The outlookis stable.

Standard & Poor's also raised its ratings on the company'sexisting senior unsecured notes to 'B+' (same as the corporatecredit rating) from 'B-' and revised the recovery rating to '4',indicating expectation of average (30%-50%) recovery in the eventof a payment default, from '5'.

In addition, Standard & Poor's assigned its issue-level andrecovery ratings to the company's pending $400 million seniorunsecured notes issuance. The issue rating is 'B+' (the same asthe corporate credit rating) and the recovery rating is '4',indicating expectation of average (30%-50%) recovery in the eventof a payment default.

"The two-notch upgrade in the notes reflects the raising of thecorporate credit rating and the revision of the recovery rating to'4'," said Standard & Poor's credit analyst David Lundberg.

"The ratings on SandRidge Energy Inc. reflect its highly leveragedfinancial profile and geographic concentration in the Pinon Fieldin West Texas, as well as S&P's expectation that near-term naturalgas prices will remain weak," added Mr. Lundberg. The ratingsalso reflect SandRidge's competitive finding and developmentcosts, strong hedge positions, and experienced management team.

The pending acquisition improves SandRidge's business risk profileby providing the company a more balanced production mix betweennatural gas and liquids, as well as a new geographic operatingarea in the Permian Basin. The properties SandRidge will acquirecontain an estimated 80 million barrel of oil equivalent (boe) oftotal proved reserves, of which an estimated 65% are liquids and44% developed. Current daily production is approximately 7,600boe. As a result of the acquisition, SandRidge expects 2010production will increase to roughly 365 million cubic feetequivalent (mmcfe) per day from 274 mmcfe currently. Liquids areexpected to constitute 27% of total production, up from 17%currently.

The stable outlook balances the company's strong hedge positionand improved production mix with S&P's bearish near-term outlookfor natural gas prices and the company's expected cash flowdeficit in 2010. A positive rating action is unlikely until S&Pgain further confidence in near-term natural gas fundamentals andthe company reduces leverage by at least a half a turn on anEBITDAX basis. S&P could consider a negative rating action ifliquidity becomes tighter toward the end of 2010 or early 2011 asa result of weak natural gas prices combined with its aggressivecapital spending plan, or if adjusted debt to EBITDAX increasesabove 4.5x.

SEMGROUP LP: Consummates Plan, Exits Chapter 11-----------------------------------------------SemGroup LP implemented the Chapter 11 plan that the bankruptcycourt approved in an Oct. 28 confirmation order. The Plan, whichdistributes more than $2.5 billion in value to its stakeholders,was declared effective November 30.

The Plan is supported by access to a $500 million exit financingfacility. Distributions to creditors will begin immediately.Creditors will receive distributions in the form of cash, commonstock and common stock warrants, as well as interests in aLitigation Trust. SemGroup expects its common stock to begintrading on a National Security Exchange by mid-2010.

"While the restructuring was a challenging process, we are trulyproud of the results. We are implementing a plan that wasoverwhelmingly supported by our creditors and that providesSemGroup with the liquidity and financial flexibility needed tocompete in the current economic environment and beyond," said NormSzydlowski, the company's president and chief executive officer.

"We are emerging from Chapter 11 restructuring with all of ourmajor businesses intact," Szydlowski said. "This will ensure thecompany remains a leader in the processing, transporting,terminalling and storing of energy."

SIX FLAGS: LACSD Wants to Compel Assumption of Contract-------------------------------------------------------The Los Angeles County Sheriff's Department asks the Court tocompel the Debtors to assume a supplemental written contractentered into between the County of Los Angeles and the Debtors.Further, LACSD asks the Court to require that the Debtors provideimmediate security for payment to the LACSD for postpetitionservices that LACSD has provided the Debtors.

Under the supplemental written contract, the LACSD providessupplemental law enforcement services at the Debtors' MagicMountain facility located in the unincorporated community ofValencia, California. The term of the Supplemental ServicesAgreement is for five years, commencing December 1, 2008, throughNovember 30, 2013, and has an estimated value of an annual sum of$758,208.

Jeffrey C. Wisler, Esq., at Connolly Bove Lodge & Hutz LLP, inWilmington, Delaware, tells the Court that services on theSupplemental Agreement are ongoing, and postpetition paymentshave been made to the County and are current. However, he says,since the filing of the Debtors' Chapter 11 case, the Debtorshave not sought to assume the Supplemental Services Agreement andthe Debtors have provided no assurance of payment in light of theprepetition amounts which remain outstanding in the amount of$328,022.

The Court will convene a hearing to consider this motion onDecember 18, 2009. Objections, if any, will be due byDecember 11.

About Six Flags

Headquartered in New York City, Six Flags, Inc., is the world'slargest regional theme park company with 20 parks across theUnited States, Mexico and Canada.

SIX FLAGS: To Seal Reports on Non-Debtor Park---------------------------------------------Six Flags Inc. and its units seek the Court's authority, pursuantto Rule 2015.3 of the Federal Rules of Bankruptcy Procedure, tofile under seal Rule 2015.3 Reports for a Non-Debtor Park.

Rule 2015.3 requires the Debtors to file, within five days beforethe first date set for the meeting of creditors under section 341of the Bankruptcy Code and no less than every six monthsthereafter, Reports for "each entity that is not a publiclytraded corporation or a debtor in a case under Chapter 11, and inwhich the estate holds a substantial or controlling interest."Rule 2015.3(c) creates a presumption that an entity of which theestate controls or owns at least 20% interest will be presumed tobe an entity in which the estate has a substantial or controllinginterest."

Section 107(c) of the Bankruptcy Code, however, allows the Court"for cause" to protect an individual in connection with certaintypes of information, including any means of identification,"where disclosure of that information would create an undue riskof . . . unlawful injury to the individual or the individual'sproperty."

On September 24, 2009, the Debtors filed their Periodic Reportregarding operations and profitability of entities in which theDebtors hold substantial or controlling interest. The Debtorsdid not include financial information regarding the Non-DebtorPark in that report.

The Non-Debtor Park is located in a potentially unstable regionof a foreign county. The Debtors believe that publicizing theRule 2015.3 Reports for the Non-Debtor Park -- and makingavailable commercial information relating to the Non-DebtorPark's employees, assets and liabilities -- would compromisepersonnel safety and employee well-being at the Non-Debtor Park.Moreover, the Debtors believe that given the region'sinstability, the financial risks that would flow from publicizingthis information would significantly harm the Debtors' estates.

The Debtors submit that the filing under seal of the Rule 2015.3Reports relating to the Non-Debtor Park, which contain commercialinformation posing a risk of significant harm to the Non-DebtorPark, its employees and other personnel, would allay thesepressing concerns, and that the filing of these reports underseal is necessary and appropriate in these circumstances.

If the Debtors' request to file under seal is granted, theDebtors propose to provide unredacted copies of the Rule 2015.3Reports for the Non-Debtor Park to the Receiving Parties, subjectto their agreement to keep the Rule 2015.3 Reports confidential.

The Court will convene a hearing to consider this motion onDecember 18, 2009, at 2:00 p.m., Eastern Standard Time.Objections will be due by December 8.

About Six Flags

Headquartered in New York City, Six Flags, Inc., is the world'slargest regional theme park company with 20 parks across theUnited States, Mexico and Canada.

Further, the Debtors ask the Court to direct that the Fee Lettersremain confidential and under seal, except for the Court, theOffice of the U.S. Trustee for the District of Delaware, andthose parties-in-interest provided with a hard-copy of the FeeLetters at the December 4, 2009, Disclosure Statement Hearing.

Daniel J. DeFrancheschi, Esq., at Richards, Layton & Finger,P.A., in Wilmington, Delaware, says the Fee Letters containconfidential commercial information regarding payments to be madeby the Debtors to their Lenders in connection with the Debtors'proposed exit financing in these Chapter 11 Cases. Moreover, theFee Letters contain explicit, bargained-for confidentialityprovisions that recognize the significance of protecting theircontents from disclosure to any other party, with certainnarrowly-circumscribed exceptions.

About Six Flags

Headquartered in New York City, Six Flags, Inc., is the world'slargest regional theme park company with 20 parks across theUnited States, Mexico and Canada.

SMURFIT-STONE: PwC Charges $2.3 Mil. for Feb. to June Work----------------------------------------------------------These professionals sought and obtained approval of theirquarterly applications for payment of fees and reimbursement ofexpenses incurred from February to June 2009:

Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard andpaper-based packaging in North America and one of the world'slargest paper recyclers. The Company operates 162 manufacturingfacilities that are primarily located in the United States andCanada. The Company also owns roughly one million acres oftimberland in Canada and operates wood harvesting facilities inCanada and the United States. The Company employs roughly21,250 employees, 17,400 of which are based in the United States.For the quarterly period ended September 30, 2008, the Companyreported roughly $7.450 billion in total assets and$5.582 billion in total liabilities on a consolidated basis.

Smurfit-Stone and its U.S. and Canadian subsidiaries filed forChapter 11 protection on January 26, 2009 (Bankr. D. Del. LeadCase No. 09-10235). Certain of the company's affiliates,including Smurfit-Stone Container Canada Inc., a wholly ownedsubsidiary of SSCE, and certain of its affiliates, filed toreorganize under the Companies' Creditors Arrangement Act in theOntario Superior Court of Justice in Canada.

Smurfit-Stone joined pulp- and paper-related bankruptcies asrising Internet use hurts magazines and newspapers. CorporacionDurango SAB, Mexico's largest papermaker, sought U.S. bankruptcyin October. Quebecor World Inc., a magazine printer and Pope &Talbot Inc., a pulp-mill operator, also sought cross-borderbankruptcies for their operations in the U.S. and Canada.

SMURFIT-STONE: M. Jackson Disposed of 19,800 Shares of Stock------------------------------------------------------------In separate Form 4 filings with the United States Securities andExchange Commission made from November 16 to December 2, 2009,these officers of Smurfit-Stone Container Corporation reportedthat on these dates, they disposed shares of SSCC common stock indifferent transactions:

Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard andpaper-based packaging in North America and one of the world'slargest paper recyclers. The Company operates 162 manufacturingfacilities that are primarily located in the United States andCanada. The Company also owns roughly one million acres oftimberland in Canada and operates wood harvesting facilities inCanada and the United States. The Company employs roughly21,250 employees, 17,400 of which are based in the United States.For the quarterly period ended September 30, 2008, the Companyreported roughly $7.450 billion in total assets and$5.582 billion in total liabilities on a consolidated basis.

Smurfit-Stone and its U.S. and Canadian subsidiaries filed forChapter 11 protection on January 26, 2009 (Bankr. D. Del. LeadCase No. 09-10235). Certain of the company's affiliates,including Smurfit-Stone Container Canada Inc., a wholly ownedsubsidiary of SSCE, and certain of its affiliates, filed toreorganize under the Companies' Creditors Arrangement Act in theOntario Superior Court of Justice in Canada.

Smurfit-Stone joined pulp- and paper-related bankruptcies asrising Internet use hurts magazines and newspapers. CorporacionDurango SAB, Mexico's largest papermaker, sought U.S. bankruptcyin October. Quebecor World Inc., a magazine printer and Pope &Talbot Inc., a pulp-mill operator, also sought cross-borderbankruptcies for their operations in the U.S. and Canada.

The Monitor informs the Court that the purpose of the NinthReport is to provide the Court with an overview of the proposedsale by MBI Limited/Limitee, as general partner of Smurfit MBI,of:

* the Edmonton container plant property, located at 8705-24 Street, Edmonton, Alberta to General Realty Group Ltd. or its nominee, and

* an industrial building located at 220 Water Street, Whitby, Ontario to Andreas Apostolopoulos, in trust for a company to be formed or an existing corporation and without personal liability, and

to provide the Monitor's recommendation.

General Realty executed an offer to purchase the EdmontonProperty for $4.5 million, subject to certain adjustments.General Realty has provided a $500,000 deposit, which will bepaid to MBI Limited/Limitee in the event the transactionscontemplated by the Offer to Purchase do not close as a result ofa breach of the Offer to Purchase by General Realty.

The purchase price payable for the Whitby Facility is $2,150,000,subject to certain adjustments. Mr. Apostolopoulos has provideda deposit of $50,000 and is to provide a second $50,000 depositupon the satisfaction or waiver of certain conditions.

The Deposits will be paid to MBI Limited/Limitee in the event thetransactions contemplated by the Agreement of Purchase and Saledo not close due to the default of Mr. Apostolopoulos.

The forecasted net sale proceeds are approximately $4.1 millionfor the Edmonton Facility and $1.7 million for the WhitbyFacility. The Monitor discloses that the proceeds of both Saleswill be applied to SSC Canada's outstanding obligations under theDIP Facility -- which is presently approximately $7.2 million --to the extent any obligations remain outstanding. The balance ofany sale proceeds will go into SSC Canada's general operatingaccount.

The Monitor submits that using the net sale proceeds from thetransactions to pay down the DIP Facility is a prudent use of thefunds by the CCAA Entities.

Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard andpaper-based packaging in North America and one of the world'slargest paper recyclers. The Company operates 162 manufacturingfacilities that are primarily located in the United States andCanada. The Company also owns roughly one million acres oftimberland in Canada and operates wood harvesting facilities inCanada and the United States. The Company employs roughly21,250 employees, 17,400 of which are based in the United States.For the quarterly period ended September 30, 2008, the Companyreported roughly $7.450 billion in total assets and$5.582 billion in total liabilities on a consolidated basis.

Smurfit-Stone and its U.S. and Canadian subsidiaries filed forChapter 11 protection on January 26, 2009 (Bankr. D. Del. LeadCase No. 09-10235). Certain of the company's affiliates,including Smurfit-Stone Container Canada Inc., a wholly ownedsubsidiary of SSCE, and certain of its affiliates, filed toreorganize under the Companies' Creditors Arrangement Act in theOntario Superior Court of Justice in Canada.

Smurfit-Stone joined pulp- and paper-related bankruptcies asrising Internet use hurts magazines and newspapers. CorporacionDurango SAB, Mexico's largest papermaker, sought U.S. bankruptcyin October. Quebecor World Inc., a magazine printer and Pope &Talbot Inc., a pulp-mill operator, also sought cross-borderbankruptcies for their operations in the U.S. and Canada.

SMURFIT-STONE: Claims Up from 40s to 60s in November Trading------------------------------------------------------------Bill Rochelle at Bloomberg News, citing reports filed with thebankruptcy court, says that during November, 902 claims weretraded. The aggregate face amount of the claims was $418 million.Unsecured claims against Smurfit-Stone Container Corp. have risenin the secondary market from the low 40% range to the low to mid60% in the last four to six weeks, according to SecondMarket Inc.,which describes itself as the largest secondary market forilliquid assets.

About Smurfit-Stone

Smurfit-Stone Container Corp. -- http://www.smurfit-stone.com/-- is one of the leading integrated manufacturers of paperboard andpaper-based packaging in North America and one of the world'slargest paper recyclers. The Company operates 162 manufacturingfacilities that are primarily located in the United States andCanada. The Company also owns roughly one million acres oftimberland in Canada and operates wood harvesting facilities inCanada and the United States. The Company employs roughly21,250 employees, 17,400 of which are based in the United States.For the quarterly period ended September 30, 2008, the Companyreported roughly $7.450 billion in total assets and$5.582 billion in total liabilities on a consolidated basis.

Smurfit-Stone and its U.S. and Canadian subsidiaries filed forChapter 11 protection on January 26, 2009 (Bankr. D. Del. LeadCase No. 09-10235). Certain of the company's affiliates,including Smurfit-Stone Container Canada Inc., a wholly ownedsubsidiary of SSCE, and certain of its affiliates, filed toreorganize under the Companies' Creditors Arrangement Act in theOntario Superior Court of Justice in Canada.

Smurfit-Stone joined pulp- and paper-related bankruptcies asrising Internet use hurts magazines and newspapers. CorporacionDurango SAB, Mexico's largest papermaker, sought U.S. bankruptcyin October. Quebecor World Inc., a magazine printer and Pope &Talbot Inc., a pulp-mill operator, also sought cross-borderbankruptcies for their operations in the U.S. and Canada.

SPANSION INC: Creditors Aim To File Own Ch. 11 Plan---------------------------------------------------Law360 reports that the unsecured creditors of Spansion Inc. onWednesday asked to be allowed to file a rival Chapter 11 plan forthe flash memory chip maker, arguing that an amended restructuringplan filed by Spansion, with the consent of a consortium ofconvertible debt holders, is an attempt to punish the unsecuredcreditors.

Spansion Inc., Spansion LLC, Spansion Technology LLC, SpansionInternational, Inc., and Cerium Laboratories LLC filed voluntarypetitions for Chapter 11 on March 1, 2009 (Bankr. D. Del. LeadCase No. 09-10690). On February 9, 2009, Spansion's Japanesesubsidiary, Spansion Japan Ltd., voluntarily entered into aproceeding under the Corporate Reorganization Law (Kaisha KoseiHo) of Japan to obtain protection from its creditors as part ofthe company's restructuring efforts. None of Spansion'ssubsidiaries in countries other than the United States and Japanare included in the U.S. or Japan filings. Michael S. Lurey,Esq., Gregory O. Lunt, Esq., and Kimberly A. Posin, Esq., atLatham & Watkins LLP, have been tapped as bankruptcy counsel.Michael R. Lastowski, Esq., at Duane Morris LLP, is the Delawarecounsel. Epiq Bankruptcy Solutions LLC, is the claims agent.The United States Trustee has appointed an official committee ofunsecured creditors in the case. As of September 30, 2008,Spansion disclosed total assets of US$3,840,000,000, and totaldebts of US$2,398,000,000.

Spansion Japan Ltd. filed a Chapter 15 petition on April 30, 2009(Bankr. D. Del. Case No. 09-11480). The Chapter 15 Petitioner'scounsel is Gregory Alan Taylor, Esq., at Ashby & Geddes. It saidthat Spansion Japan had US$10 million to US$50 million in assetsand US$50 million to US$100 million in debts.

SPRINT NEXTEL: Directly Owns 48,924,061 iPCS Common Shares----------------------------------------------------------Sprint Nextel Corp. has filed an initial statement of beneficialownership of common shares in iPCS, Inc., on Form 3 with theSecurities and Exchange Commission.

Pursuant to an agreement and plan of merger, dated as ofOctober 18, 2009, by and among iPCS, Inc., Sprint NextelCorporation, and Ireland Acquisition Corporation, a wholly-ownedsubsidiary of Sprint Nextel, Ireland Acquisition commenced atender offer to purchase all of the issued and outstanding sharesof common stock, par value $0.01 per share, of iPCS, for $24.00per share, net to the seller in cash, without interest and lessany applicable withholding taxes, upon the terms and subject tothe conditions set forth in the Offer to Purchase datedOctober 28, 2009, and in the related letter of transmittal.

As a result of the merger, the separate corporate existence of theIreland Acquisition ceased and the iPCS continues as the survivingcorporation of the merger and a wholly-owned subsidiary of SprintNextel.

Sprint Nextel discloses that it acquired all of the shares notpreviously tendered pursuant to the offer at the offer price. Asa result it now directly owns 48,924,061 shares of common stock ofiPCS, par value $0.01 per share.

As of September 30, 2009, iPCS' licensed territory had a totalpopulation of approximately 15.1 million residents, of which itswireless network covered approximately 12.7 million residents, andiPCS had approximately 720,100 subscribers.

At September 30, 2009, iPCS, Inc.'s consolidated balance sheetsshowed $559.2 million in total assets and $592.2 million in totalliabilities, resulting in a $33.0 million shareholders' deficit.

Overland Park, Kansas-based Sprint Nextel Corporation --http://www.sprint.com/-- offers a comprehensive range of wireless and wireline communications services bringing the freedom ofmobility to consumers, businesses and government users. SprintNextel is widely recognized for developing, engineering anddeploying innovative technologies, including two wireless networksserving more than 48 million customers at the end of the thirdquarter of 2009 and the first and only 4G service from a nationalcarrier in the United States; industry-leading mobile dataservices; instant national and international push-to-talkcapabilities; and a global Tier 1 Internet backbone.

As of September 30, 2009, the company had $55.648 billion in totalassets against $37.414 billion in total liabilities. As ofSeptember 30, 2009, the company had $5.9 billion in cash, cashequivalents and short-term investments and $1.6 billion inborrowing capacity available under its revolving bank creditfacility, for total liquidity of $7.5 billion.

SPX CORPORATION: Fitch Says Rating Trends Stable------------------------------------------------According to Fitch Ratings, the number of negative rating actionsfor the U.S. Diversified Industrials sector is likely to be muchlower in 2010 than in 2009 as rating trends are expected tostabilize. A return to economic growth across many regions, thegradual completion of restructuring and downsizing programs, focusby issuers on stronger balance sheets, and a more stable operatingenvironment compared to the early phase of the global recessionwill all contribute to more stability next year. The pace ofratings downgrades in the broader U.S. corporate bond marketslowed materially in the third quarter of 2009, which would beconsistent with expectations for a slowly improving global economyand better performance by most companies in the diversifiedindustrial sector.

'Currently, Negative Rating Outlooks among diversified companiesrated by Fitch significantly outnumber Positive Outlooks, but asissuers repair their credit profiles, Negative Outlooks could berevised to Stable and upgrades could increase,' said Eric Ause,Senior Director at Fitch. 'Positive rating actions would beexpected to occur late in the credit cycle, possibly after 2010 asa return to stronger credit metrics may be slower than usual,which reflects the severity of the recent recession, simultaneousstresses in the credit markets that have pressured liquidity, andthe potentially anemic pace of an economic rebound.'

Issuers Expected to Rebuild Balance Sheets in 2010:

Entering 2010, leverage is at relatively high levels for manydiversified companies. Higher-than-normal leverage is not unusualat this stage of the credit cycle and is due largely to loweroperating results. When operating results eventually improve,leverage can also be expected to improve. However, the recoveryis anticipated to be slow which could hinder a return to lowerleverage. This concern is partly mitigated by a trend towardsmanaging balance sheets more conservatively in response todifficult capital markets and the evident value of liquidity.Several diversified companies issued meaningful amounts of equityin the first nine months of 2009 (GE, JCI, KMT, TXT), notincluding ETN which issued equity in 2008, and two issuers (GE,TXT) cut their dividends. Acquisition activity has been quiet butcould increase in 2010, reflecting recent increases in valuations.

Rebound in Operating Performance Expected to be Slow:

Sales in 2010 for U.S. diversified companies are expected toimprove slowly from trough levels reported during 2009, but therecovery from the recent recession could be fitful. Fitchanticipates that a full recovery will not occur until late-cyclesectors of the economy begin to revive, possibly as late as 2011.Underpinning Fitch's Diversified outlook is the firm's most recentglobal economic outlook, which as of October 2009 calls for globalGDP to shrink 2.8% in 2009, the first time annual growth has beennegative since WWII, followed by expected global growth recoveryto 2% in 2010 and 2.7% in 2011. In the major advanced economies(MAEs) where diversified companies still conduct the bulk of theirbusiness, GDP is forecast to decline 3.7% in 2009 and return to atepid growth rate of 1.2% in 2010. Fitch expects GDP to grow 6.5%in the BRIC countries (Brazil, Russia, India, China) in 2010.Although global GDP looks set to return to positive growth, theabsolute level of GDP is low, and it is possible that in the U.S.GDP may not return to the 2008 level until 2011.

Mixed Revenue Outlook:

Diversified companies typically are composed of a mix of early-,mid- and late-cycle businesses. They also sell into diversegeographic end-markets. As a result, the pace at which salesrecover will vary by issuer depending on each issuer's customerbase. On a sequential basis, demand generally stopped falling bythe third quarter of 2009. In many late-cycle markets, ordershave stopped falling, although actual sales could decline foranother quarter or two. Most issuers remain cautious aboutpredicting the strength and timing of a rebound in sales. Normaleconomic signals are obscured by several factors: 1) inventorydestocking earlier in 2009, followed by re-stocking which wouldrepresent a non-recurring boost to sales, 2) the U.S. cash-for-clunkers program that accelerated the replacement of oldervehicles in the automotive sector, and 3) stimulus spending inChina and cash-for-clunkers programs in Europe.

Late-cycle businesses such as non-residential construction willremain weak well into 2010, offsetting improvements in early cyclebusinesses. In the aerospace sector, Fitch expects largecommercial aircraft deliveries by Boeing and Airbus to declineapproximately 5% (excluding potential 787 deliveries) from 2009,but there is a risk of additional production cuts, especially in2011. However, high backlogs at Boeing and Airbus should bufferthe expected decline. The aerospace aftermarket could show someimprovement in late 2010 after declining sharply in 2009 due to areduction in the number of flights and the cannibalization ofparked planes by the airlines. Business jet deliveries appearlikely to decline further in 2010 following a very weak year in2009. Fitch expects business jet deliveries for all of 2009 tofall 35-40% from a cyclical peak in 2008, and a peak to troughdecline of 50% would not be unrealistic. Diversified companieswith material exposure to aerospace include GE, ETN, HON, TXT andUTX.

Non-residential construction is expected to fall 12% in 2010following a 16% decline in 2009 according to the AmericanInstitute of Architects' most recent Consensus ConstructionForecast. It is possible that conditions could be weak wellbeyond 2010, depending on trends in vacancy rates and theavailability of financing. Most diversified companies have someexposure to non-residential construction through electricalproducts (CBE, HUBB, ETN, TNB), controls and systems (HON, JCI),elevators (UTX), scaffolding (HSC) and a wide variety of otherproducts and services. Some non-residential markets will benefitfrom expected spending related to stimulus and energy conservationprojects, particularly institutional buildings for which theoutlook is not as negative as it is for office, retail andindustrial buildings.

The U.S. market is expected to fare worse than other regionsaround the globe. Europe is also weak. Developing markets havelargely performed better than developed markets and should returnto normal growth more quickly. As the U.S. represents a largeshare of total non-residential construction, a protracted downturnin non-residential construction will temper the impact ofimproving results in other parts of the economy. Residentialconstruction also is a significant market for diversifiedcompanies. The sector has shrunk so much over the past few yearsthat there is not much downside risk. On the other hand, it isnot clear how quickly the sector will recover given the largeinventory of homes, a lack of liquidity affecting privatefinancing, and declining valuations that leave many homeownerswith negative equity.

The outlook is more positive for shorter-cycle, consumptionoriented businesses (services and parts) that should benefit froma resumption of stable economic activity. However, absolute saleslevels are currently low and growth seems likely to be tepid asthere are few end-markets where strong demand is expected. Salesgrowth could vary across sectors depending on their location inthe capital investment chain. Sales of longer-lived parts andequipment may only recover gradually as existing productioncapacity and equipment is brought to full capacity or used up.Exceptions include certain energy and infrastructure markets.These markets are less directly tied to economic cycles than tolong-term demand for energy and to demographic trends that affectpublic funding for water and transportation projects.

Margins to Benefit from Cost Controls and Stabilizing Sales:

During 2010 diversified companies can be expected to rebuildmargins as they complete restructuring efforts and align costswith lower sales levels. Margin performance has varied widely in2009. Some companies (UTX, TNB, FLS) reacted early or were ableto take advantage of a variable cost structure to limit margindeclines. In other cases, orders and sales dropped sharply,particularly in short-cycle businesses, contributing to temporaryquarterly losses (KMT, ETN, JCI). Profitability typically wasrestored by the third quarter of 2009 when sales stopped fallingat the rapid pace that occurred in the first half of the year.Although conditions should be more stable in 2010 than during2009, demand remains weak and diversified companies will bechallenged to balance the risk of excess capacity with thepossible loss of market share when demand eventually improves. Inlate-cycle businesses, margins could remain under pressure wellinto 2010 until the recession runs its course. This concern ismitigated by a long order cycle, relative to short-cyclebusinesses, that helps smooth out production and reduce salesvolatility. Cancellations by customers remain a risk, however, asdoes the availability of financing that often is an importantfactor in long-cycle projects. Government stimulus spending maylimit these risks depending on where and when it is used.

Other items could also affect margins in 2010. Raw material costshave fallen dramatically since peaking in 2008. However, somecosts, such as oil and copper, have subsequently rebounded,highlighting volatility as an ongoing risk. In the near term, aweak economy can be expected to keep raw material costs atmoderate levels. Pricing represents another risk. To date therehas been limited pricing pressure, but it could increase as oldcontracts run off and as diversified companies and their customerscontinue to adjust to a period of low demand. Finally, pensionexpense could increase depending on market conditions. Any cashimpact on pension contributions would appear to become moresignificant after 2010.

Restructuring to Wind Down Gradually:

As restructuring is gradually completed, margins in 2010 will besupported by lower costs and the absence of restructuring charges.Any increases in volume would also support margins through betterabsorption. Margins in 2010 may not increase to levels seen priorto the recession, but they should improve on a sequential basiscompared to cyclical lows, many of which occurred in the secondquarter of 2009. Steep sales declines in the first half of 2009depressed operating margins, sometimes causing losses in certainbusinesses as capacity couldn't be reduced quickly enough tooffset lower volumes.

Temporary cost reductions were initiated by a large number ofdiversified companies during 2009 to protect profits and preserveliquidity. Their eventual reversal could partly negate thepositive impact of restructuring. Some temporary cost reductionshave already been reversed, but others remain in place and may notbe reversed until economic conditions improve further. Temporarycuts included furloughs and reductions to compensation such asbonuses and 401(k) plans.

Free Cash Flow Could Decline Modestly:

Fitch anticipates that cash from operating activities in the nearterm may be only slightly lower than historical levels, relativeto income. As explained above, aggressive restructuring hasenabled many diversified companies to limit margin declines tomodest levels. Working capital reductions have supported cashflow during 2009 as sales have fallen. Sales growth in 2010 couldreverse this trend and require cash to be invested in workingcapital, but amounts likely would not be large given expectationsfor slow economic growth.

Pension liabilities continue to be a concern. Although assetreturns in 2009 have been favorable, interest rates remain low andmay negate a portion of asset returns when net pension liabilitiesare calculated at the end of 2009. In many cases, requiredpension contributions in 2010 may remain low, but they couldincrease in subsequent years unless further strong asset returnsand/or an increase in the discount rate help to reduce net pensionliabilities.

Fitch does not expect capital expenditures to increasesubstantially in 2010 compared to reduced levels in 2009. Theprimary driver is the lack of investment opportunities related toslow growth, although some issuers in 2009 reduced capitalspending in an effort to preserve liquidity in the face ofdifficult conditions in the debt markets. As with workingcapital, any benefit to free cash flow would likely be reversedonce sales improve and companies look to take advantage ofinternal growth opportunities.

Uncertain Impact of Discretionary Expenditures:

Acquisitions may become more common in 2010 as visibility intoend-market demand improves further. Most diversified companiescontinue to maintain a list of potential acquisitions and couldact quickly. Acquisition activity was relatively low in 2009 dueto a focus by some issuers on preserving liquidity, the relatedissue of limited availability or high cost of financing, theunwillingness of sellers to accept low prices, and a priority onrestructuring existing operations.

Share repurchases could increase in 2010 but are not likely, inFitch's view, to be nearly as substantial as in previous years.Issuers are focused on maintaining a strong balance sheet tooffset the impact of weaker earnings, a lack of confidence in theavailability of financing, and uncertainty about the economy.Even UTX and SPW, which are among the more consistent companieswith respect to discretionary cash deployment, have scaled backshare repurchases until conditions improve.

Liquidity and Financing Expected to be Manageable:

Disruptions in the capital markets during the past two years havefaded but could have a long tail. Government support played amajor role in stabilizing the capital markets and it continues tobe important. Despite investor confidence that contributed tostrong market returns during 2009, it is unclear to what degreethe capital markets still depend on government support or howquickly government support will be phased out. Diversifiedcompanies sell into end-markets where financing may be needed tofund projects or large equipment. If the availability offinancing continues to be problematic for customers of diversifiedcompanies, future sales could be negatively affected.

Among the diversified companies rated by Fitch, financingcontinues to be available and liquidity concerns have beenaddressed successfully. The only exception was TXT's drawdown ofits bank facilities in February 2009 as a defensive action toprotect its liquidity while it proceeds with the wind-down of non-captive financing at Textron Financial. Even so, TXT wassubsequently able to issue debt and equity. Although issuers areable to access the capital markets, there are concerns aboutmarket reliability.

Issuers are likely to be less sensitive to conditions in thecommercial paper market in 2010 than during the past one to two,largely because they have taken a more cautious approach tomanaging their balance sheets in response to the previous capitalmarket disruptions. A number of issuers paid down commercialpaper balances with proceeds from long-term debt or equity, whileothers paid down commercial paper as a way to reduce total debtand control leverage. Due to continuing uncertainty surroundingthe capital markets, issuers could continue to look foropportunities to issue debt in 2010 while interest rates arefavorable.

Bank financing has become more restrictive, most notably whenissuers look to renew revolving credit facilities that typicallyrepresent an important source of liquidity. Previous marketlosses and growing delinquencies that normally accompanyrecessions have pressured bank to improve their capitalization andreduce their risk exposure. As a result, banks are offering lessfavorable terms. In most cases, revolving credits are beingrenewed at lower amounts, shorter terms and higher pricing. Ifsuch terms don't eventually return toward previous levels, issuersmay consider increasing their reliance on long-term debt and othersources of financing.

Strategic Implications:

The impact of the recession on credit metrics for certain issuers(ETN, JCI, TXT) has been exacerbated by a variety of factors suchas acquisitions, end-market exposure, or strategic actions.Depending on the path of the economic recovery, more time thanusual may be needed to return credit metrics to normal levels atthese and other issuers similarly affected. Debt reduction can beexpected to be a priority. However, a long-term risk is thepossibility that it may be difficult to regain stronger creditmetrics while at the same time funding strategically importantactivities such as acquisitions. As a result, there potentiallycould be a trade-off, at least in the short run, betweenprofitability and competitiveness on one hand and, on the otherhand, a strong balance sheet and financial flexibility.

Issuers in the Diversified Industrial Sector:

Fitch-rated issuers and their current Issuer Default Ratings inthe U.S. diversified industrial sector:

On December 2, 2009, Sterling filed with the United StatesBankruptcy Court in the District of Idaho a disclosure statementproviding information concerning Sterling's proposed plan ofreorganization indicating that Minco Silver's offer is the bestoffer.

Pursuant to the provisions of Sterling's plan of reorganizationMinco Silver will credit bid the full amount of its' secured claimestimated at USD$9,400,000, with the balance (approximatelyUSD$3,100,000) paid in cash.

Minco Silver continues to fund Sterling's expenses associated withthe care and maintenance of the Sunshine Mine and all of its'administrative costs pursuant to the terms and conditions of theCourt approved Supplemental Post Petition Secured FinancingAgreement.

The Canadian Press says Minco Silver's US$12.5 million credit bid-- comprised of a US$9.4 million secured claim and US$3.1 millioncash -- surpasses the US$11.75 million offer of Alberta StarDevelopment Corp.

About Minco Silver

Minco Silver Corporation is a TSX listed company focusing on theacquisition and development of silver dominant projects. TheCompany owns 90% interest in the world class Fuwan Silver Deposit,situated along the northeast margin of the highly prospectiveFuwan Silver Belt. Minco Silver is extremely pleased with thepositive results of its Bankable Feasibility Study demonstrating arobust deposit is and is working towards bringing the Fuwan SilverDeposit into production.

About Sterling Mining

Based in Coeur d'Alene, Idaho, Sterling Mining Company (OTCBB:SRLMand FSE:SMX) -- http://www.SterlingMining.com/-- is a mineral resource development and exploration company. The company has along term lease on the Sunshine Mine in North Idaho's Coeurd'Alene Mining District. The Sunshine Mine is comprised of 5,930patented and unpatented acres, and historically produced over360 million ounces of silver from 1884 until its closure in early2001. Sterling Mining leased the Sunshine Mine in June 2003,along with a mill, extensive mining infrastructure and equipment,a large land package, and a database encompassing a long historyof exploration, development and production.

As of September 30, 2008, Sterling Mining had $31.9 million intotal assets, and $13.2 million in total current liabilities and$1.6 million in total long-term liabilities. In its schedules,the Debtor listed total assets of $11,706,761 and total debts of$14,159,010.

STERLING MINING: Plan Allocates $500,000 for Unsec. Creditors-------------------------------------------------------------Sterling Mining Company filed with the U.S. Bankruptcy Court forthe District of Idaho a Chapter 11 Plan of Reorganization and theaccompanying Disclosure Statement.

The Debtors will begin soliciting votes on the Plan after theapproval of the adequacy of the information in the DisclosureStatement.

According to the Disclosure Statement, the Plan contemplates thefull repayment of all secured debt of the allowed securedcreditors, with interest. The Plan provides for the full paymentof all administrative claims on or before the effective date. ThePlan provides for the full payment of unclassified priority claimsfor the internal Revenue Service on or before the effective date.

The Plan provides for a dividend of $500,000, more or less, to beapplied pro rata to all allowed unsecured general claims. TheClaims will be paid on or before the effective date, with nointerest, with the balance of the claims discharged by a dischargeentered in the case.

All common stock interests, or other claims equity interests inSterling will be cancelled, and the equity security holders willreceive nothing through the proposed plan of reorganization.

The Debtor anticipates the sale of its common stock and transferof ownership of the company to fund the Chapter 11 plan.

Based in Coeur d'Alene, Idaho, Sterling Mining Company (OTCBB:SRLMand FSE:SMX) -- http://www.SterlingMining.com/-- is a mineral resource development and exploration company. The company has along term lease on the Sunshine Mine in North Idaho's Coeurd'Alene Mining District. The Sunshine Mine is comprised of 5,930patented and unpatented acres, and historically produced over360 million ounces of silver from 1884 until its closure in early2001. Sterling Mining leased the Sunshine Mine in June 2003,along with a mill, extensive mining infrastructure and equipment,a large land package, and a database encompassing a long historyof exploration, development and production.

As of September 30, 2008, Sterling Mining had $31.9 million intotal assets, and $13.2 million in total current liabilities and$1.6 million in total long-term liabilities. In its schedules,the Debtor listed total assets of $11,706,761 and total debts of$14,159,010.

TAYLOR BEAN: Will County Treasurer Works to Help Homeowners-----------------------------------------------------------The Plainfield Sun reports that Will County Treasurer Pat McGuireand his staff were helping more than 1,000 homeowners whosesecond-installment property taxes remain unpaid one month afterTaylor, Bean & Whitaker Mortgage Corp. went bankrupt. Accordingto The Sun, TBW had in escrow second-installment taxes on 1,737Will County properties, and payment on 506 of them had reached thetreasurer as of September 22. The Sun quoted Mr. McGuire assaying, "TBW did not call, e-mail, or mail its customers to tellthem it filed Chapter 11 on August 24 and dumped their mortgageson four other companies. TBW customers who called us after we putout a press release August 28 said they hadn't known their lenderwent belly up. The same thing happened this week after we sentlate-payment reminders."

Taylor Bean & Whitaker Mortgage Corp., the 12th largest U.S.mortgage lender and servicer of loans, filed for bankruptcyprotection on August 24 after being suspended from doing businesswith U.S. agencies and Freddie Mac, the government-supportedmortgage company. Taylor has blamed probes into one of its banksfor the suspensions.

Taylor Bean filed for Chapter 11 on August 24 (Bankr. M.D. Fla.Case No. 09-07047). Edward J. Peterson, III, Esq., at Stichter,Riedel, Blain & Prosser, PA, in Tampa, Florida, represents theDebtor. Troutman Sanders LLP is special counsel. BMC Group Inc.serves as claims agent. Taylor Bean has more than $1 billion ofboth assets and liabilities, and between 1,000 and 5,000creditors, according to the bankruptcy petition.

TEXTRON INC: Fitch Says Rating Trends Stable---------------------------------------------According to Fitch Ratings, the number of negative rating actionsfor the U.S. Diversified Industrials sector is likely to be muchlower in 2010 than in 2009 as rating trends are expected tostabilize. A return to economic growth across many regions, thegradual completion of restructuring and downsizing programs, focusby issuers on stronger balance sheets, and a more stable operatingenvironment compared to the early phase of the global recessionwill all contribute to more stability next year. The pace ofratings downgrades in the broader U.S. corporate bond marketslowed materially in the third quarter of 2009, which would beconsistent with expectations for a slowly improving global economyand better performance by most companies in the diversifiedindustrial sector.

'Currently, Negative Rating Outlooks among diversified companiesrated by Fitch significantly outnumber Positive Outlooks, but asissuers repair their credit profiles, Negative Outlooks could berevised to Stable and upgrades could increase,' said Eric Ause,Senior Director at Fitch. 'Positive rating actions would beexpected to occur late in the credit cycle, possibly after 2010 asa return to stronger credit metrics may be slower than usual,which reflects the severity of the recent recession, simultaneousstresses in the credit markets that have pressured liquidity, andthe potentially anemic pace of an economic rebound.'

Issuers Expected to Rebuild Balance Sheets in 2010:

Entering 2010, leverage is at relatively high levels for manydiversified companies. Higher-than-normal leverage is not unusualat this stage of the credit cycle and is due largely to loweroperating results. When operating results eventually improve,leverage can also be expected to improve. However, the recoveryis anticipated to be slow which could hinder a return to lowerleverage. This concern is partly mitigated by a trend towardsmanaging balance sheets more conservatively in response todifficult capital markets and the evident value of liquidity.Several diversified companies issued meaningful amounts of equityin the first nine months of 2009 (GE, JCI, KMT, TXT), notincluding ETN which issued equity in 2008, and two issuers (GE,TXT) cut their dividends. Acquisition activity has been quiet butcould increase in 2010, reflecting recent increases in valuations.

Rebound in Operating Performance Expected to be Slow:

Sales in 2010 for U.S. diversified companies are expected toimprove slowly from trough levels reported during 2009, but therecovery from the recent recession could be fitful. Fitchanticipates that a full recovery will not occur until late-cyclesectors of the economy begin to revive, possibly as late as 2011.Underpinning Fitch's Diversified outlook is the firm's most recentglobal economic outlook, which as of October 2009 calls for globalGDP to shrink 2.8% in 2009, the first time annual growth has beennegative since WWII, followed by expected global growth recoveryto 2% in 2010 and 2.7% in 2011. In the major advanced economies(MAEs) where diversified companies still conduct the bulk of theirbusiness, GDP is forecast to decline 3.7% in 2009 and return to atepid growth rate of 1.2% in 2010. Fitch expects GDP to grow 6.5%in the BRIC countries (Brazil, Russia, India, China) in 2010.Although global GDP looks set to return to positive growth, theabsolute level of GDP is low, and it is possible that in the U.S.GDP may not return to the 2008 level until 2011.

Mixed Revenue Outlook:

Diversified companies typically are composed of a mix of early-,mid- and late-cycle businesses. They also sell into diversegeographic end-markets. As a result, the pace at which salesrecover will vary by issuer depending on each issuer's customerbase. On a sequential basis, demand generally stopped falling bythe third quarter of 2009. In many late-cycle markets, ordershave stopped falling, although actual sales could decline foranother quarter or two. Most issuers remain cautious aboutpredicting the strength and timing of a rebound in sales. Normaleconomic signals are obscured by several factors: 1) inventorydestocking earlier in 2009, followed by re-stocking which wouldrepresent a non-recurring boost to sales, 2) the U.S. cash-for-clunkers program that accelerated the replacement of oldervehicles in the automotive sector, and 3) stimulus spending inChina and cash-for-clunkers programs in Europe.

Late-cycle businesses such as non-residential construction willremain weak well into 2010, offsetting improvements in early cyclebusinesses. In the aerospace sector, Fitch expects largecommercial aircraft deliveries by Boeing and Airbus to declineapproximately 5% (excluding potential 787 deliveries) from 2009,but there is a risk of additional production cuts, especially in2011. However, high backlogs at Boeing and Airbus should bufferthe expected decline. The aerospace aftermarket could show someimprovement in late 2010 after declining sharply in 2009 due to areduction in the number of flights and the cannibalization ofparked planes by the airlines. Business jet deliveries appearlikely to decline further in 2010 following a very weak year in2009. Fitch expects business jet deliveries for all of 2009 tofall 35-40% from a cyclical peak in 2008, and a peak to troughdecline of 50% would not be unrealistic. Diversified companieswith material exposure to aerospace include GE, ETN, HON, TXT andUTX.

Non-residential construction is expected to fall 12% in 2010following a 16% decline in 2009 according to the AmericanInstitute of Architects' most recent Consensus ConstructionForecast. It is possible that conditions could be weak wellbeyond 2010, depending on trends in vacancy rates and theavailability of financing. Most diversified companies have someexposure to non-residential construction through electricalproducts (CBE, HUBB, ETN, TNB), controls and systems (HON, JCI),elevators (UTX), scaffolding (HSC) and a wide variety of otherproducts and services. Some non-residential markets will benefitfrom expected spending related to stimulus and energy conservationprojects, particularly institutional buildings for which theoutlook is not as negative as it is for office, retail andindustrial buildings.

The U.S. market is expected to fare worse than other regionsaround the globe. Europe is also weak. Developing markets havelargely performed better than developed markets and should returnto normal growth more quickly. As the U.S. represents a largeshare of total non-residential construction, a protracted downturnin non-residential construction will temper the impact ofimproving results in other parts of the economy. Residentialconstruction also is a significant market for diversifiedcompanies. The sector has shrunk so much over the past few yearsthat there is not much downside risk. On the other hand, it isnot clear how quickly the sector will recover given the largeinventory of homes, a lack of liquidity affecting privatefinancing, and declining valuations that leave many homeownerswith negative equity.

The outlook is more positive for shorter-cycle, consumptionoriented businesses (services and parts) that should benefit froma resumption of stable economic activity. However, absolute saleslevels are currently low and growth seems likely to be tepid asthere are few end-markets where strong demand is expected. Salesgrowth could vary across sectors depending on their location inthe capital investment chain. Sales of longer-lived parts andequipment may only recover gradually as existing productioncapacity and equipment is brought to full capacity or used up.Exceptions include certain energy and infrastructure markets.These markets are less directly tied to economic cycles than tolong-term demand for energy and to demographic trends that affectpublic funding for water and transportation projects.

Margins to Benefit from Cost Controls and Stabilizing Sales:

During 2010 diversified companies can be expected to rebuildmargins as they complete restructuring efforts and align costswith lower sales levels. Margin performance has varied widely in2009. Some companies (UTX, TNB, FLS) reacted early or were ableto take advantage of a variable cost structure to limit margindeclines. In other cases, orders and sales dropped sharply,particularly in short-cycle businesses, contributing to temporaryquarterly losses (KMT, ETN, JCI). Profitability typically wasrestored by the third quarter of 2009 when sales stopped fallingat the rapid pace that occurred in the first half of the year.Although conditions should be more stable in 2010 than during2009, demand remains weak and diversified companies will bechallenged to balance the risk of excess capacity with thepossible loss of market share when demand eventually improves. Inlate-cycle businesses, margins could remain under pressure wellinto 2010 until the recession runs its course. This concern ismitigated by a long order cycle, relative to short-cyclebusinesses, that helps smooth out production and reduce salesvolatility. Cancellations by customers remain a risk, however, asdoes the availability of financing that often is an importantfactor in long-cycle projects. Government stimulus spending maylimit these risks depending on where and when it is used.

Other items could also affect margins in 2010. Raw material costshave fallen dramatically since peaking in 2008. However, somecosts, such as oil and copper, have subsequently rebounded,highlighting volatility as an ongoing risk. In the near term, aweak economy can be expected to keep raw material costs atmoderate levels. Pricing represents another risk. To date therehas been limited pricing pressure, but it could increase as oldcontracts run off and as diversified companies and their customerscontinue to adjust to a period of low demand. Finally, pensionexpense could increase depending on market conditions. Any cashimpact on pension contributions would appear to become moresignificant after 2010.

Restructuring to Wind Down Gradually:

As restructuring is gradually completed, margins in 2010 will besupported by lower costs and the absence of restructuring charges.Any increases in volume would also support margins through betterabsorption. Margins in 2010 may not increase to levels seen priorto the recession, but they should improve on a sequential basiscompared to cyclical lows, many of which occurred in the secondquarter of 2009. Steep sales declines in the first half of 2009depressed operating margins, sometimes causing losses in certainbusinesses as capacity couldn't be reduced quickly enough tooffset lower volumes.

Temporary cost reductions were initiated by a large number ofdiversified companies during 2009 to protect profits and preserveliquidity. Their eventual reversal could partly negate thepositive impact of restructuring. Some temporary cost reductionshave already been reversed, but others remain in place and may notbe reversed until economic conditions improve further. Temporarycuts included furloughs and reductions to compensation such asbonuses and 401(k) plans.

Free Cash Flow Could Decline Modestly:

Fitch anticipates that cash from operating activities in the nearterm may be only slightly lower than historical levels, relativeto income. As explained above, aggressive restructuring hasenabled many diversified companies to limit margin declines tomodest levels. Working capital reductions have supported cashflow during 2009 as sales have fallen. Sales growth in 2010 couldreverse this trend and require cash to be invested in workingcapital, but amounts likely would not be large given expectationsfor slow economic growth.

Pension liabilities continue to be a concern. Although assetreturns in 2009 have been favorable, interest rates remain low andmay negate a portion of asset returns when net pension liabilitiesare calculated at the end of 2009. In many cases, requiredpension contributions in 2010 may remain low, but they couldincrease in subsequent years unless further strong asset returnsand/or an increase in the discount rate help to reduce net pensionliabilities.

Fitch does not expect capital expenditures to increasesubstantially in 2010 compared to reduced levels in 2009. Theprimary driver is the lack of investment opportunities related toslow growth, although some issuers in 2009 reduced capitalspending in an effort to preserve liquidity in the face ofdifficult conditions in the debt markets. As with workingcapital, any benefit to free cash flow would likely be reversedonce sales improve and companies look to take advantage ofinternal growth opportunities.

Uncertain Impact of Discretionary Expenditures:

Acquisitions may become more common in 2010 as visibility intoend-market demand improves further. Most diversified companiescontinue to maintain a list of potential acquisitions and couldact quickly. Acquisition activity was relatively low in 2009 dueto a focus by some issuers on preserving liquidity, the relatedissue of limited availability or high cost of financing, theunwillingness of sellers to accept low prices, and a priority onrestructuring existing operations.

Share repurchases could increase in 2010 but are not likely, inFitch's view, to be nearly as substantial as in previous years.Issuers are focused on maintaining a strong balance sheet tooffset the impact of weaker earnings, a lack of confidence in theavailability of financing, and uncertainty about the economy.Even UTX and SPW, which are among the more consistent companieswith respect to discretionary cash deployment, have scaled backshare repurchases until conditions improve.

Liquidity and Financing Expected to be Manageable:

Disruptions in the capital markets during the past two years havefaded but could have a long tail. Government support played amajor role in stabilizing the capital markets and it continues tobe important. Despite investor confidence that contributed tostrong market returns during 2009, it is unclear to what degreethe capital markets still depend on government support or howquickly government support will be phased out. Diversifiedcompanies sell into end-markets where financing may be needed tofund projects or large equipment. If the availability offinancing continues to be problematic for customers of diversifiedcompanies, future sales could be negatively affected.

Among the diversified companies rated by Fitch, financingcontinues to be available and liquidity concerns have beenaddressed successfully. The only exception was TXT's drawdown ofits bank facilities in February 2009 as a defensive action toprotect its liquidity while it proceeds with the wind-down of non-captive financing at Textron Financial. Even so, TXT wassubsequently able to issue debt and equity. Although issuers areable to access the capital markets, there are concerns aboutmarket reliability.

Issuers are likely to be less sensitive to conditions in thecommercial paper market in 2010 than during the past one to two,largely because they have taken a more cautious approach tomanaging their balance sheets in response to the previous capitalmarket disruptions. A number of issuers paid down commercialpaper balances with proceeds from long-term debt or equity, whileothers paid down commercial paper as a way to reduce total debtand control leverage. Due to continuing uncertainty surroundingthe capital markets, issuers could continue to look foropportunities to issue debt in 2010 while interest rates arefavorable.

Bank financing has become more restrictive, most notably whenissuers look to renew revolving credit facilities that typicallyrepresent an important source of liquidity. Previous marketlosses and growing delinquencies that normally accompanyrecessions have pressured bank to improve their capitalization andreduce their risk exposure. As a result, banks are offering lessfavorable terms. In most cases, revolving credits are beingrenewed at lower amounts, shorter terms and higher pricing. Ifsuch terms don't eventually return toward previous levels, issuersmay consider increasing their reliance on long-term debt and othersources of financing.

Strategic Implications:

The impact of the recession on credit metrics for certain issuers(ETN, JCI, TXT) has been exacerbated by a variety of factors suchas acquisitions, end-market exposure, or strategic actions.Depending on the path of the economic recovery, more time thanusual may be needed to return credit metrics to normal levels atthese and other issuers similarly affected. Debt reduction can beexpected to be a priority. However, a long-term risk is thepossibility that it may be difficult to regain stronger creditmetrics while at the same time funding strategically importantactivities such as acquisitions. As a result, there potentiallycould be a trade-off, at least in the short run, betweenprofitability and competitiveness on one hand and, on the otherhand, a strong balance sheet and financial flexibility.

Issuers in the Diversified Industrial Sector:

Fitch-rated issuers and their current Issuer Default Ratings inthe U.S. diversified industrial sector:

TEXTRON INC: Fitch Says Sector's Outlook Steady, Risks Remain-------------------------------------------------------------Credit quality in the U.S. commercial aerospace industry willremain under pressure in 2010, while the U.S. defense sector islikely to experience more stability, according to Fitch Ratings.Fitch expects deliveries in all commercial aerospace originalequipment segments to decline in 2010, but aftermarket salesshould begin to improve modestly. Defense spending will continueto grow in the low single digits.

Credit metrics for many A&D companies deteriorated in 2009, butthey are likely to be steady in 2010. Profits and cash flowscould be helped by improvement in the high-margin aftermarket, thefull-year impact of 2009 cost reductions, and defense growth, butthey will be held back by higher pension expense and weakcommercial OE markets. Fitch says liquidity remains strong afterimproving in 2009 because of lower share repurchases and someopportunistic debt issuance, but the company expects cashdeployment will increase during 2010, particularly foracquisitions and pension contributions.

Key risks for the sector include the weak global economicrecovery, exogenous shocks (terrorism, disease pandemic, etc.),large U.S. government deficits, and execution on new programs.The 787 program remains a continuing source of risk for Boeing andits suppliers. Flight hours and airline traffic have moved off ofcyclical lows, but they remain at depressed levels. A generalrisk is that some production rates have not been revised downwardmaterially despite the weak economy. Fitch does not expect thatfinancing availability will be a limit on aircraft deliveries in2010, although some concerns remain in the aircraft financebusiness. Longer-term, Fitch considers the commercial outlooksolid because of large backlogs and the need to build aerospaceinfrastructure in developing regions.

-- Large Commercial Aircraft: Fitch expects LCA deliveries from Boeing and Airbus will decline approximately 5% in 2010 to 920 aircraft, with revenues down 5%-10%. These estimates incorporate the announced production cuts for the A320 family (down two aircraft per month) and B777 (down almost 30%), but they exclude possible 787 deliveries (discussed below). Fitch believes there is a strong chance of additional production cuts, but these are more likely to take place in 2011. Long manufacturing lead times, advance payment requirements, and indications of sold-out 2010 production schedules support the argument against additional cuts next year, unless they are announced in the next few months to take effect at the end of 2010.

Fitch's forecasts will include additional 5%-15% cuts beginning in2011. Fitch forecasts the additional LCA production reductions in2011 because of a moderate global economic recovery, airlinecapacity reductions in 2008 and 2009, substantial airline losses,and deliveries that are exceeding typical aircraft retirements.However, the eventual production declines should be moderaterelative to prior LCA cycles as a result of large backlogs,production restraint since the last downturn, some remainingoverbooking in the delivery plans, and the geographic diversity ofthe customer base. In addition, the long-term nature of aircraftassets, as well as operating cost savings, provide incentive forcustomers to continue taking delivery of aircraft despitecyclically weak airline traffic. If the projected production cutsare managed with sufficient lead time, both the manufacturers andthe supply base should be able to adjust their cost structures intime to prevent deterioration of their credit profiles.

Fitch expects LCA orders to be low in 2010 and 2011, acontinuation of the trend in 2009, in which there have been only287 net orders through November compared to 867 deliveries duringthe same period. There were 142 cancellations through November,and Boeing has indicated that it had approximately 215 deferralsin the first three quarters. Low orders are not a credit concerngiven that Boeing and Airbus had a combined backlog of 6,849aircraft at the end of November, equal to more than seven years ofproduction at estimated 2010 rates. Excluding 787 and A350backlogs, the industry still has almost six years worth of orders.

Boeing's 787 program will continue to be a key concern for the LCAsector and its supply base in 2010. If Boeing meets its currentschedule, Fitch estimates the company could deliver 10-15 787s inlate 2010, but there is considerable risk to the schedule,including an aggressive flight testing program, certification, andthe production ramp-up. Boeing will be building 787s through theflight testing program, exposing the company to the risk ofreworking some aircraft if problems are discovered during theflight tests. Uncertainty over customer penalties and supplierclaims add to the 787s risks. Through November, the 787 accountedfor the bulk of Boeing's order cancellations (83 out of 111),although the company still has 840 firm orders for the aircraft.

-- Commercial Aftermarket/Services: The commercial aftermarket will likely be the first part of the aerospace industry to recover from the downturn. Fitch forecasts aftermarket spending will be flat to up 5% in 2010, with a weak first half offset by an improved second half. The expected economic rebound should drive airline traffic growth and eventually will lead to rising flight hours and capacity, which are the primary drivers of aftermarket spending. Some inventory rebuilding and completion of deferred maintenance should also help the aftermarket recover in 2010. Business jet utilization has also been improving off of a low base, which will aid aftermarket spending in that sector.

Fitch's general concern for the aftermarket is that currentconditions are still very weak, with many companies reportingdouble digit declines year-over-year in the third quarter. Somecapacity metrics are still negative despite indications ofincreased airline traffic. Fitch will have more conviction on theoutlook for this sector once capacity starts to increase.Companies with healthy exposures to this high-margin segmentinclude Goodrich, Honeywell, Rockwell Collins, Transdigm, andUnited Technologies.

-- The business jet market was the worst commercial aerospace sector in 2009, suffering a rapid and severe downturn. Industry deliveries fell 38% through September, and Fitch expects a 35%-40% unit decline for the year, with revenues likely down 25%-30%. An eventual peak-to-trough unit decline of 50% or more for the industry is not out of the question, and Fitch expects aircraft deliveries to fall another 5%-10% in 2010 from 2009 levels. The large unit declines result from hundreds of order cancellations and the failure of light jet manufacturer Eclipse Aviation.

Although utilization rates have started to rise and corporateprofits have turned up, Fitch expects continued weakness in thesector because utilization rates are still well below peak levelsand the corporate profit improvement is largely due to costcutting. This sector will continue to be volatile because of thediscretionary nature of the product, the availability of numeroussubstitute forms of travel, and the relationship to corporateprofits. A key development in the sector in the past five yearshas been strong orders from outside North America, and theseinternational orders could be the catalyst for an upturn beyond2010. Manufacturers in this sector include Bombardier, DassaultAviation, Embraer, General Dynamics, Hawker Beechcraft, andTextron, as well as key suppliers such as Honeywell.

-- The regional aircraft market (regional jets and turboprops) has many of the same drivers as the LCA market, but it has lower backlogs. Orders so far in 2009 have been weak, and the outlook for this sector is negative for 2010. Regional jets deliveries from Bombardier and Embraer will probably fall about 15% in 2009 and at least 15% in 2010, excluding possible deliveries from new entrants in the market. Fitch estimates that turboprop deliveries from Bombardier and ATR (a joint venture between EADS and Finmeccanica) will rise modestly in 2009, but they will likely decline 5% in 2010. New entrants into the regional jet market remain an important part of the sector's outlook, and in 2010 the market will likely see the initial deliveries of Sukhoi's Superjet 100 and China's ARJ21.

Defense:

High U.S. DoD spending levels continue to support defense sectorcredit quality, and the outlook is still favorable in the nearterm because spending in fiscal year 2010 will continue to rise.The core DoD budget should grow approximately 4% in FY2010, andmodernization spending (procurement plus R&D), the most relevantpart of the budget for defense contractors, should be up 2%-3%.Fitch believes that FY2010 is probably the peak in modernizationspending, and there are several risks to monitor in FY2011 andbeyond. These include the Obama Administration's first fullbudget in FY2011, the Quadrennial Defense Review, and the largeprojected federal budget deficits in FY2009-FY2011. In additionto spending levels, some other changes proposed by the newadministration could have a detrimental impact on defensecontractors, including acquisition reform and the 'insourcing' ofservices previously contracted out by the DoD.

Fitch believes core modernization spending could decline 1%-2% inFY2011, although the overall core budget could rise. The FY2011budget and QDR will likely continue the changes the Obamaadministration introduced in the current year's budget, and Fitchis not anticipating any dramatic shifts. Fitch expectssupplemental spending that supports operations in Iraq andAfghanistan will fall over the next several years, but for severalreasons the decline will be gradual, and the supplemental spendingwill not disappear. Spending related to Iraq will be down, butspending in Afghanistan will increase. Some security spending bythe U.S. in Iraq will likely be replaced by Iraqi governmentspending, which could continue to be a source of revenues to U.S.contractors. Finally, the DoD will need to refurbish or replacesome equipment and material that is in poor condition or left inIraq.

Given the strong credit metrics and liquidity at most of theleading defense contractors, ratings in the sector are unlikely tobe pressured by modest declines in modernization spending.Program execution and cash deployment probably present greaterrisks. Defense company backlogs fell in the first three quartersof 2009 due to some program cancellations, although orders in thefourth quarter could reverse some of the decline.

Liquidity and Cash Deployment:

Strong liquidity and financial flexibility helped the NorthAmerican A&D industry withstand the difficult economy in 2009, andthe industry even improved its liquidity position in the past 12months, although at the expense of increasing total debt to$60 billion from $55 billion. At the end of the third quarter thetop 15 A&D companies rated by Fitch in North America had$35 billion in cash compared to approximately $5 billion incurrent debt maturities and short-term debt. The only materialcredit facilities set to expire in 2010 (GD, L-3, and RTN) havealready been replaced.

Many companies in the sector pulled back on discretionaryexpenditures in 2009 (share repurchases fell $10 billion, forexample) in the interests of building liquidity. Withstabilization appearing in some parts of the A&D sector, Fitchexpects greater cash deployment in 2010. Acquisition activitybegan to increase in the past quarter, and Fitch expects this willcontinue in 2010. Share repurchases and dividend increases willlikely rise as well.

Higher pension contributions will be another use of cash in 2010.The A&D sector has seven of the largest 25 pension plans incorporate America, and some are significantly underfunded. Thesituation is mitigated for defense contractors, which get somerecovery of pension costs in government contracts. Harmonizationof Cost Accounting Standards and the Pension Protection Act issomething to watch during 2010.

In Fitch's view, Boeing will have the most significant liquiditypressures in 2010. Delays in the 787 and 747-8 programs over thepast 18 months have negatively affected Boeing's credit qualitybecause of inventory build-up, delayed advance payments, andhigher development expenses. Cash flow pressures will likelypersist into 2011 due to continued inventory build-up in supportof initial 787 deliveries. Although free cash flow will probablybe positive in 2009, Fitch believes that break-even or negativefree cash flow is possible in 2010 depending on the ultimateschedule for 787 deliveries, production rates on other aircraftmodels, and the company's working capital management, which hasbeen good in 2009 considering the 787 inventory pressures andreduced advances because of lower orders.

Aircraft Finance:

Fitch does not expect that financing availability will be a limiton aircraft deliveries in 2010, although some concerns remain inthe aircraft finance business. The aircraft finance market wasnot as bad as feared in 2009, and Fitch expects this trend tocontinue because credit markets have improved and lower forecastedaircraft deliveries will mean a lower financing requirement thanin 2009. Fitch projects funding requirements will be$60-$65 billion for LCA and regional aircraft in 2010, about$5 billion lower than in 2009. An additional $10-$15 billioncould be needed for business jets, also down versus 2009.

Concerns in the aircraft finance market include the damagedbusiness models of some large aircraft lessors, the exit of somebanks from the market, and indications that pre-delivery paymentfinancing was difficult for some airlines in 2009. Severalfactors offset these concerns, including strong support fromexport credit agencies, the emergence of some regional financialplayers in the market, better capital markets activity in the pastfew months, and the ability of Boeing and Airbus to providecustomer financing. Fitch estimates that ECAs could supportapproximately 25% of LCA deliveries in 2009, illustrating thebenefit the industry has received from indirect governmentsupport. It looks like Boeing and Airbus will finance less than$2 billion of new aircraft in 2009, leaving the companies with thecapacity to help customers in 2010 if needed. New aircraft serveas attractive lending collateral due to the mobility of theassets, operating efficiency compared to previous aircraftgenerations, and unique treatment in bankruptcy in somejurisdictions.

The comments above apply to new aircraft financing, notrefinancings of existing debt. Fitch estimates that there will be$14 billion of maturing airline debt in the U.S. alone in 2010-2011.

Economic Assumptions:

Underpinning Fitch's A&D outlook is the firm's most recent globaleconomic outlook, which as of October 2009 calls for global GDP toshrink 2.8% in 2009, followed by global growth recovery to 2% in2010 and 2.7% in 2011. GDP should rise, but from a low base, andexpansion will be weak relative to previous recoveries. There issome uncertainty in 2011 due to likely tightening of monetary andfiscal stimulus. Fitch expects GDP to grow 6.5% in the BRICcountries (Brazil, Russia, India, China) in 2010. Although globalGDP looks set to return to positive growth, the absolute level ofGDP is low and, in the U.S., it is possible that GDP may notreturn to the 2008 level until 2011.

Fitch's specific A&D assumptions include no recovery in 2010 otherthan early cycle parts such as aftermarket. Late cycle segmentssuch as original equipment will continue to be weak, showing somevolume declines, although nowhere near as dramatic as in 2009 orin the last downturn that began in 2001.

A more detailed report on the global 2010 aerospace & defenseindustry outlook will be available on the Fitch Ratings Web siteat 'www.fitchratings.com' in January.

Fitch-rated issuers and their current Issuer Default Ratings inthe North American aerospace/defense sector:

-- Alliant Techsystems Inc. (ATK) ('BB'; Outlook Stable);

-- Boeing Company (BA) ('A+'; Outlook Negative);

-- Bombardier Inc. (BBD/B) ('BB+'; Outlook Negative);

-- General Dynamics Corporation (GD) ('A'; Outlook Stable);

-- Goodrich Corporation (GR) ('BBB+'; Outlook Stable);

-- Honeywell International Inc. (HON) ('A'; Outlook Negative);

-- ITT Corporation (ITT) ('A-'; Outlook Stable)

-- L-3 Communications Corporation (LLL) ('BBB-'; Outlook Stable);

-- Lockheed Martin Corporation (LMT) ('A-'; Outlook Stable);

-- Northrop Grumman Corporation (NOC) ('BBB+'; Outlook Stable);

-- Raytheon Company (RTN) ('A-'; Outlook Stable);

-- Rockwell Collins, Inc. (COL) ('A'; Outlook Stable);

-- Textron Inc. (TXT) ('BB+'; Outlook Negative);

-- Transdigm Group (TDG) ('B'; Outlook Stable);

-- United Technologies Corporation (UTC) ('A+'; Outlook Stable).

TRADEWINDS AIRLINES: Not in Default on $30MM Loan, Court Ruled--------------------------------------------------------------Jennifer Dixon at Detroit Free Press reports that U.S. DistrictJudge Victoria Roberts rejected a request by Detroit's two publicpensions to declare TradeWinds Airlines in default on a$30 million investment, ruling that the dispute should go totrial. Free Press relates that the pensions had asked JudgeRoberts to find Donald V. Watkins in default on a $30 million loanto purchase TradeWinds Airlines when the Company declaredbankruptcy. Judge Roberts, according to Free Press, ruled that atrial is needed to consider Mr. Watkins' allegations thatTradeWinds Airlines was pushed into bankruptcy after he refusedrequests from pension fund trustees for favors, including the useof his jet for a speaker at an NAACP dinner. Free Press says thatno trial date has been set. Judge Roberts dismissed Mr. Watkins'countersuit against the pensions but allowed his case against thepensions' investment adviser, Adrian Anderson of North PointAdvisors, to proceed, the report states.

Headquartered at the Triad International Airport in Greensboro,North Carolina, TradeWinds Airlines LLC --http://www.tradewinds-airlines.com/-- operates A300-B4F freighter aircraft for domestic and foreign customers. The company hasoperations at Miami International Airport and in Puerto Rico.

TRANSDIGM GROUP: Fitch Says Sector's Outlook Steady, Risks Remain-----------------------------------------------------------------Credit quality in the U.S. commercial aerospace industry willremain under pressure in 2010, while the U.S. defense sector islikely to experience more stability, according to Fitch Ratings.Fitch expects deliveries in all commercial aerospace originalequipment segments to decline in 2010, but aftermarket salesshould begin to improve modestly. Defense spending will continueto grow in the low single digits.

Credit metrics for many A&D companies deteriorated in 2009, butthey are likely to be steady in 2010. Profits and cash flowscould be helped by improvement in the high-margin aftermarket, thefull-year impact of 2009 cost reductions, and defense growth, butthey will be held back by higher pension expense and weakcommercial OE markets. Fitch says liquidity remains strong afterimproving in 2009 because of lower share repurchases and someopportunistic debt issuance, but the company expects cashdeployment will increase during 2010, particularly foracquisitions and pension contributions.

Key risks for the sector include the weak global economicrecovery, exogenous shocks (terrorism, disease pandemic, etc.),large U.S. government deficits, and execution on new programs.The 787 program remains a continuing source of risk for Boeing andits suppliers. Flight hours and airline traffic have moved off ofcyclical lows, but they remain at depressed levels. A generalrisk is that some production rates have not been revised downwardmaterially despite the weak economy. Fitch does not expect thatfinancing availability will be a limit on aircraft deliveries in2010, although some concerns remain in the aircraft financebusiness. Longer-term, Fitch considers the commercial outlooksolid because of large backlogs and the need to build aerospaceinfrastructure in developing regions.

-- Large Commercial Aircraft: Fitch expects LCA deliveries from Boeing and Airbus will decline approximately 5% in 2010 to 920 aircraft, with revenues down 5%-10%. These estimates incorporate the announced production cuts for the A320 family (down two aircraft per month) and B777 (down almost 30%), but they exclude possible 787 deliveries (discussed below). Fitch believes there is a strong chance of additional production cuts, but these are more likely to take place in 2011. Long manufacturing lead times, advance payment requirements, and indications of sold-out 2010 production schedules support the argument against additional cuts next year, unless they are announced in the next few months to take effect at the end of 2010.

Fitch's forecasts will include additional 5%-15% cuts beginning in2011. Fitch forecasts the additional LCA production reductions in2011 because of a moderate global economic recovery, airlinecapacity reductions in 2008 and 2009, substantial airline losses,and deliveries that are exceeding typical aircraft retirements.However, the eventual production declines should be moderaterelative to prior LCA cycles as a result of large backlogs,production restraint since the last downturn, some remainingoverbooking in the delivery plans, and the geographic diversity ofthe customer base. In addition, the long-term nature of aircraftassets, as well as operating cost savings, provide incentive forcustomers to continue taking delivery of aircraft despitecyclically weak airline traffic. If the projected production cutsare managed with sufficient lead time, both the manufacturers andthe supply base should be able to adjust their cost structures intime to prevent deterioration of their credit profiles.

Fitch expects LCA orders to be low in 2010 and 2011, acontinuation of the trend in 2009, in which there have been only287 net orders through November compared to 867 deliveries duringthe same period. There were 142 cancellations through November,and Boeing has indicated that it had approximately 215 deferralsin the first three quarters. Low orders are not a credit concerngiven that Boeing and Airbus had a combined backlog of 6,849aircraft at the end of November, equal to more than seven years ofproduction at estimated 2010 rates. Excluding 787 and A350backlogs, the industry still has almost six years worth of orders.

Boeing's 787 program will continue to be a key concern for the LCAsector and its supply base in 2010. If Boeing meets its currentschedule, Fitch estimates the company could deliver 10-15 787s inlate 2010, but there is considerable risk to the schedule,including an aggressive flight testing program, certification, andthe production ramp-up. Boeing will be building 787s through theflight testing program, exposing the company to the risk ofreworking some aircraft if problems are discovered during theflight tests. Uncertainty over customer penalties and supplierclaims add to the 787s risks. Through November, the 787 accountedfor the bulk of Boeing's order cancellations (83 out of 111),although the company still has 840 firm orders for the aircraft.

-- Commercial Aftermarket/Services: The commercial aftermarket will likely be the first part of the aerospace industry to recover from the downturn. Fitch forecasts aftermarket spending will be flat to up 5% in 2010, with a weak first half offset by an improved second half. The expected economic rebound should drive airline traffic growth and eventually will lead to rising flight hours and capacity, which are the primary drivers of aftermarket spending. Some inventory rebuilding and completion of deferred maintenance should also help the aftermarket recover in 2010. Business jet utilization has also been improving off of a low base, which will aid aftermarket spending in that sector.

Fitch's general concern for the aftermarket is that currentconditions are still very weak, with many companies reportingdouble digit declines year-over-year in the third quarter. Somecapacity metrics are still negative despite indications ofincreased airline traffic. Fitch will have more conviction on theoutlook for this sector once capacity starts to increase.Companies with healthy exposures to this high-margin segmentinclude Goodrich, Honeywell, Rockwell Collins, Transdigm, andUnited Technologies.

-- The business jet market was the worst commercial aerospace sector in 2009, suffering a rapid and severe downturn. Industry deliveries fell 38% through September, and Fitch expects a 35%-40% unit decline for the year, with revenues likely down 25%-30%. An eventual peak-to-trough unit decline of 50% or more for the industry is not out of the question, and Fitch expects aircraft deliveries to fall another 5%-10% in 2010 from 2009 levels. The large unit declines result from hundreds of order cancellations and the failure of light jet manufacturer Eclipse Aviation.

Although utilization rates have started to rise and corporateprofits have turned up, Fitch expects continued weakness in thesector because utilization rates are still well below peak levelsand the corporate profit improvement is largely due to costcutting. This sector will continue to be volatile because of thediscretionary nature of the product, the availability of numeroussubstitute forms of travel, and the relationship to corporateprofits. A key development in the sector in the past five yearshas been strong orders from outside North America, and theseinternational orders could be the catalyst for an upturn beyond2010. Manufacturers in this sector include Bombardier, DassaultAviation, Embraer, General Dynamics, Hawker Beechcraft, andTextron, as well as key suppliers such as Honeywell.

-- The regional aircraft market (regional jets and turboprops) has many of the same drivers as the LCA market, but it has lower backlogs. Orders so far in 2009 have been weak, and the outlook for this sector is negative for 2010. Regional jets deliveries from Bombardier and Embraer will probably fall about 15% in 2009 and at least 15% in 2010, excluding possible deliveries from new entrants in the market. Fitch estimates that turboprop deliveries from Bombardier and ATR (a joint venture between EADS and Finmeccanica) will rise modestly in 2009, but they will likely decline 5% in 2010. New entrants into the regional jet market remain an important part of the sector's outlook, and in 2010 the market will likely see the initial deliveries of Sukhoi's Superjet 100 and China's ARJ21.

Defense:

High U.S. DoD spending levels continue to support defense sectorcredit quality, and the outlook is still favorable in the nearterm because spending in fiscal year 2010 will continue to rise.The core DoD budget should grow approximately 4% in FY2010, andmodernization spending (procurement plus R&D), the most relevantpart of the budget for defense contractors, should be up 2%-3%.Fitch believes that FY2010 is probably the peak in modernizationspending, and there are several risks to monitor in FY2011 andbeyond. These include the Obama Administration's first fullbudget in FY2011, the Quadrennial Defense Review, and the largeprojected federal budget deficits in FY2009-FY2011. In additionto spending levels, some other changes proposed by the newadministration could have a detrimental impact on defensecontractors, including acquisition reform and the 'insourcing' ofservices previously contracted out by the DoD.

Fitch believes core modernization spending could decline 1%-2% inFY2011, although the overall core budget could rise. The FY2011budget and QDR will likely continue the changes the Obamaadministration introduced in the current year's budget, and Fitchis not anticipating any dramatic shifts. Fitch expectssupplemental spending that supports operations in Iraq andAfghanistan will fall over the next several years, but for severalreasons the decline will be gradual, and the supplemental spendingwill not disappear. Spending related to Iraq will be down, butspending in Afghanistan will increase. Some security spending bythe U.S. in Iraq will likely be replaced by Iraqi governmentspending, which could continue to be a source of revenues to U.S.contractors. Finally, the DoD will need to refurbish or replacesome equipment and material that is in poor condition or left inIraq.

Given the strong credit metrics and liquidity at most of theleading defense contractors, ratings in the sector are unlikely tobe pressured by modest declines in modernization spending.Program execution and cash deployment probably present greaterrisks. Defense company backlogs fell in the first three quartersof 2009 due to some program cancellations, although orders in thefourth quarter could reverse some of the decline.

Liquidity and Cash Deployment:

Strong liquidity and financial flexibility helped the NorthAmerican A&D industry withstand the difficult economy in 2009, andthe industry even improved its liquidity position in the past 12months, although at the expense of increasing total debt to$60 billion from $55 billion. At the end of the third quarter thetop 15 A&D companies rated by Fitch in North America had$35 billion in cash compared to approximately $5 billion incurrent debt maturities and short-term debt. The only materialcredit facilities set to expire in 2010 (GD, L-3, and RTN) havealready been replaced.

Many companies in the sector pulled back on discretionaryexpenditures in 2009 (share repurchases fell $10 billion, forexample) in the interests of building liquidity. Withstabilization appearing in some parts of the A&D sector, Fitchexpects greater cash deployment in 2010. Acquisition activitybegan to increase in the past quarter, and Fitch expects this willcontinue in 2010. Share repurchases and dividend increases willlikely rise as well.

Higher pension contributions will be another use of cash in 2010.The A&D sector has seven of the largest 25 pension plans incorporate America, and some are significantly underfunded. Thesituation is mitigated for defense contractors, which get somerecovery of pension costs in government contracts. Harmonizationof Cost Accounting Standards and the Pension Protection Act issomething to watch during 2010.

In Fitch's view, Boeing will have the most significant liquiditypressures in 2010. Delays in the 787 and 747-8 programs over thepast 18 months have negatively affected Boeing's credit qualitybecause of inventory build-up, delayed advance payments, andhigher development expenses. Cash flow pressures will likelypersist into 2011 due to continued inventory build-up in supportof initial 787 deliveries. Although free cash flow will probablybe positive in 2009, Fitch believes that break-even or negativefree cash flow is possible in 2010 depending on the ultimateschedule for 787 deliveries, production rates on other aircraftmodels, and the company's working capital management, which hasbeen good in 2009 considering the 787 inventory pressures andreduced advances because of lower orders.

Aircraft Finance:

Fitch does not expect that financing availability will be a limiton aircraft deliveries in 2010, although some concerns remain inthe aircraft finance business. The aircraft finance market wasnot as bad as feared in 2009, and Fitch expects this trend tocontinue because credit markets have improved and lower forecastedaircraft deliveries will mean a lower financing requirement thanin 2009. Fitch projects funding requirements will be$60-$65 billion for LCA and regional aircraft in 2010, about$5 billion lower than in 2009. An additional $10-$15 billioncould be needed for business jets, also down versus 2009.

Concerns in the aircraft finance market include the damagedbusiness models of some large aircraft lessors, the exit of somebanks from the market, and indications that pre-delivery paymentfinancing was difficult for some airlines in 2009. Severalfactors offset these concerns, including strong support fromexport credit agencies, the emergence of some regional financialplayers in the market, better capital markets activity in the pastfew months, and the ability of Boeing and Airbus to providecustomer financing. Fitch estimates that ECAs could supportapproximately 25% of LCA deliveries in 2009, illustrating thebenefit the industry has received from indirect governmentsupport. It looks like Boeing and Airbus will finance less than$2 billion of new aircraft in 2009, leaving the companies with thecapacity to help customers in 2010 if needed. New aircraft serveas attractive lending collateral due to the mobility of theassets, operating efficiency compared to previous aircraftgenerations, and unique treatment in bankruptcy in somejurisdictions.

The comments above apply to new aircraft financing, notrefinancings of existing debt. Fitch estimates that there will be$14 billion of maturing airline debt in the U.S. alone in 2010-2011.

Economic Assumptions:

Underpinning Fitch's A&D outlook is the firm's most recent globaleconomic outlook, which as of October 2009 calls for global GDP toshrink 2.8% in 2009, followed by global growth recovery to 2% in2010 and 2.7% in 2011. GDP should rise, but from a low base, andexpansion will be weak relative to previous recoveries. There issome uncertainty in 2011 due to likely tightening of monetary andfiscal stimulus. Fitch expects GDP to grow 6.5% in the BRICcountries (Brazil, Russia, India, China) in 2010. Although globalGDP looks set to return to positive growth, the absolute level ofGDP is low and, in the U.S., it is possible that GDP may notreturn to the 2008 level until 2011.

Fitch's specific A&D assumptions include no recovery in 2010 otherthan early cycle parts such as aftermarket. Late cycle segmentssuch as original equipment will continue to be weak, showing somevolume declines, although nowhere near as dramatic as in 2009 orin the last downturn that began in 2001.

A more detailed report on the global 2010 aerospace & defenseindustry outlook will be available on the Fitch Ratings Web siteat 'www.fitchratings.com' in January.

Fitch-rated issuers and their current Issuer Default Ratings inthe North American aerospace/defense sector:

-- Alliant Techsystems Inc. (ATK) ('BB'; Outlook Stable);

-- Boeing Company (BA) ('A+'; Outlook Negative);

-- Bombardier Inc. (BBD/B) ('BB+'; Outlook Negative);

-- General Dynamics Corporation (GD) ('A'; Outlook Stable);

-- Goodrich Corporation (GR) ('BBB+'; Outlook Stable);

-- Honeywell International Inc. (HON) ('A'; Outlook Negative);

-- ITT Corporation (ITT) ('A-'; Outlook Stable)

-- L-3 Communications Corporation (LLL) ('BBB-'; Outlook Stable);

-- Lockheed Martin Corporation (LMT) ('A-'; Outlook Stable);

-- Northrop Grumman Corporation (NOC) ('BBB+'; Outlook Stable);

-- Raytheon Company (RTN) ('A-'; Outlook Stable);

-- Rockwell Collins, Inc. (COL) ('A'; Outlook Stable);

-- Textron Inc. (TXT) ('BB+'; Outlook Negative);

-- Transdigm Group (TDG) ('B'; Outlook Stable);

-- United Technologies Corporation (UTC) ('A+'; Outlook Stable).

TRIBUNE CO: Plan Exclusivity Extended Until February---------------------------------------------------Tribune Co. asked Judge Kevin J. Carey of the U.S. BankruptcyCourt for the District of Delaware to further extend its exclusiveperiods to file a plan of reorganization through March 31, 2010and to solicit acceptances of that Plan through May 31, 2010.Senior secured lenders owed $4.4 billion by Tribune Co. tried topersuade the judge to terminate exclusivity to allow them to filea reorganization plan for the operating subsidiaries of Tribune.

Following a hearing, the bankruptcy judge extended until Februarythe Company's exclusive right to propose a plan, Bill Rochelle atBloomberg News reported. Until that time, the secured lenderswon't be able to file a Chapter 11 plan, unless it negotiates aconsensual plan with tribune.

TRONOX INC: Inks Exit Financing Letters With Goldman & GECC-----------------------------------------------------------In a Form-8K filing with the United States Securities andExchange Commission, Tronox Incorporated disclosed that while thesale process continues, the Company, on November 10, 2009,entered into letter agreements with each of General ElectricCapital Corporation and Goldman Sachs Lending Partners LLC eachto act as financing source and arranger, respectively, inconnection with providing new debtor in possession to exitfinancing for a $125 million asset backed revolver facility and a$300 million first lien term loan.

Michael J. Foster, vice president, general counsel and secretaryof Tronox Incorporated, says that if the Company is able to reachagreement with its stakeholders regarding a standalonereorganization and chooses to pursue a reorganization rather thana sale, and if the Company, GE and Goldman's efforts aresuccessful and a plan of reorganization is confirmed, theproceeds from the DIP to Exit Facilities would be used torefinance the Company's existing indebtedness, fund a potentialsettlement with the United States Government and be available forgeneral corporate purposes following the Company's exit frombankruptcy.

About Tronox Inc.

Headquartered in Oklahoma City, Tronox Incorporated (Pink Sheets:TRXAQ, TRXBQ) is the world's fourth-largest producer and marketerof titanium dioxide pigment, with an annual production capacity of535,000 tonnes. Titanium dioxide pigment is an inorganic whitepigment used in paint, coatings, plastics, paper and many othereveryday products. The Company's four pigment plants, which arelocated in the United States, Australia and the Netherlands,supply high-performance products to approximately 1,100 customersin 100 countries. In addition, Tronox produces electrolyticproducts, including sodium chlorate, electrolytic manganesedioxide, boron trichloride, elemental boron and lithium manganeseoxide.

Tronox has $1.6 billion in total assets, including $646.9 millionin current assets, as at September 30, 2008. The Company has$881.6 million in current debts and $355.9 million in totalnoncurrent debts.

An official committee of unsecured creditors and an officialcommittee of equity security holders have been appointed in thecases. The Creditors Committee has retained Paul, Weiss, Rifkind,Wharton & Garrison LLP as counsel.

Until September 30, 2008, Tronox Inc. was publicly traded on theNew York Stock Exchange under the symbols TRX and TRX.B. Sincethen, Tronox Inc. has traded on the Over the Counter BulletinBoard under the symbols TROX.A.PK and TROX.B.PK. As ofDecember 31, 2008, Tronox Inc. had 19,107,367 outstanding sharesof class A common stock and 22,889,431 outstanding shares of classB common stock.

TRONOX INC: Professionals Reduce April to Aug Fees by $434,000--------------------------------------------------------------Professionals retained in Tronox Inc.'s bankruptcy cases filedinterim applications for the allowance of fees and expensesincurred for the period from April 1 through August 31, 2009:

The U.S. Trustee relates that the Retained Professionals seekfees totaling $8,416,423 and reimbursement of out-of-pocketexpenses totaling $375,276.

In response to the comments and concerns of the U.S. Trustee, theRetained Professionals have agreed to voluntarily reduce theirrequests for interim compensation in the aggregate amount of$434,338 and to voluntarily reduce their reimbursement of out-of-pocket expenses in the aggregate amount of $16,796.

At the request of the U.S. Trustee, the Retained Professionalshave also agreed that the Court may reduce the compensationawarded by a percentage to be determined by the Court pending thefinal resolution of the cases.

* * *

After the Professionals resolved the informal objections of theU.S. Trustee with respect to the Applications, the Court hasgranted by fee applications of these professionals:

Headquartered in Oklahoma City, Tronox Incorporated (Pink Sheets:TRXAQ, TRXBQ) is the world's fourth-largest producer and marketerof titanium dioxide pigment, with an annual production capacity of535,000 tonnes. Titanium dioxide pigment is an inorganic whitepigment used in paint, coatings, plastics, paper and many othereveryday products. The Company's four pigment plants, which arelocated in the United States, Australia and the Netherlands,supply high-performance products to approximately 1,100 customersin 100 countries. In addition, Tronox produces electrolyticproducts, including sodium chlorate, electrolytic manganesedioxide, boron trichloride, elemental boron and lithium manganeseoxide.

Tronox has $1.6 billion in total assets, including $646.9 millionin current assets, as at September 30, 2008. The Company has$881.6 million in current debts and $355.9 million in totalnoncurrent debts.

An official committee of unsecured creditors and an officialcommittee of equity security holders have been appointed in thecases. The Creditors Committee has retained Paul, Weiss, Rifkind,Wharton & Garrison LLP as counsel.

Until September 30, 2008, Tronox Inc. was publicly traded on theNew York Stock Exchange under the symbols TRX and TRX.B. Sincethen, Tronox Inc. has traded on the Over the Counter BulletinBoard under the symbols TROX.A.PK and TROX.B.PK. As ofDecember 31, 2008, Tronox Inc. had 19,107,367 outstanding sharesof class A common stock and 22,889,431 outstanding shares of classB common stock.

TRUE TEMPER: Wins Confirmation of Modified Plan-----------------------------------------------Bill Rochelle at Bloomberg News reports that True Temper SportsInc. obtained confirmation of its Chapter 11 plan, although with achange allowing general unsecured creditors to pass throughbankruptcy unaffected and still be able to collect on theirclaims.

The U.S. Trustee for Region 3 objected to the original iterationof the Plan because some unsecured trade suppliers, who were toreceive less than full payment, weren't permitted to vote on theplan. Other unsecured creditors, taking nothing from the plan,were given "little or no notice," according to the U.S. Trustee'sobjection.

According to Mr. Rochelle, the Court's confirmation order providesthat general unsecured creditors will be unaffected by thebankruptcy, enabling them to collect their debts.

The Plan restructures senior debt into a combination of exitfinancing and equity in the reorganized debtor. Debt holders andstockholders -- the plan investors -- are injecting $70 millioncash that will be used pay down first-lien debt totaling$105.6 million. The remainder of the first-lien debt will beconverted into a new term loan under the plan. The Plan Investorswill obtain most of the new stock of the reorganized company.The holders of $45 million in second-lien debt are to receive11.4% of the new stock.

About True Temper

True Temper is the leading manufacturer of golf shafts in theworld, and is consistently the number one shaft on allprofessional tours globally. The Company markets a complete lineof shafts under the True Temper(R), Grafalloy(R) and Project X(R)shaft brands, and sells these brands in more than 30 countriesthroughout the world. True Temper is proudly represented by morethan 800 individuals in ten facilities located in the UnitedStates, Europe, Japan, China and Australia.

As of June 28, 2009, the Company had $180.4 million in totalassets and $319.0 million in total liabilities, resulting instockholders' deficit of $138.5 million.

TVI CORP: Wins Confirmation of Reorganization Plan--------------------------------------------------The Bankruptcy Court signed an order confirming the reorganizationplan of TVI Corp. on Dec. 8. The Company's name is changing toImmediate Response Technologies Inc. The Chapter 11 plan providesfor secured lender Branch Banking & Trust Co., owed $17.4 million,to receive $700,000 cash along with all the new equity and adeficiency claim for about $12 million. Unsecured creditors splitup $390,000 cash. The Signature special events business is beingsold for $1.3 million.

About TVI Corporation

Headquartered in Glenn Dale, Maryland, TVI Corporation --http://www.tvicorp.com/-- supplies military and civilian emergency first responder and first receiver products, personalprotection products and quick-erect shelter systems. The productsinclude powered air-purifying respirators, respiratory filters andquick-erect shelter systems used for decontamination, hospitalsurge systems and command and control. The users of theseproducts include military and homeland defense/homeland securitycustomers.

The Company and two of its affiliates filed for Chapter 11protection on April 1, 2009 (Bankr. D. Md. Lead Case No.09-15677). Christopher William Mahoney, Esq., Jeffrey W. Spear,Esq., and Joel M. Walker, Esq., at Duane Morris LLP, represent theDebtors in their restructuring efforts. Alan M. Grochal, Esq.,and Maria Ellena Chavez-Ruark, Esq., at Tydings and Rosenberg,serve as counsel to the official committee of unsecured creditors.

UNITED MARITIME: S&P Assigns Corporate Credit Rating at 'B'-----------------------------------------------------------Standard & Poor's Ratings Services assigned its 'B' corporatecredit rating to United Maritime Group LLC. At the same time, S&Passigned a 'B' rating to the proposed $200 million second-liennotes, the same as the corporate credit rating, as well as a '4'recovery rating, indicating expectations of an average (30%-50%)recovery in a payment default scenario.

The ratings on Tampa-based United Maritime reflect its highlyleveraged financial profile and participation in the highlycompetitive and capital-intensive shipping industry. The ratingsalso reflect exposure to cyclical demand swings in certain endmarkets and vulnerability to weather-related disruptions inbusiness operations.

"The stable outlook reflects S&P's expectations that the companywill generate gradually improving earnings and cash flow, butremain highly leveraged," said Standard & Poor's credit analystFunmi Afonja. There is little room in the rating fordeterioration in the financial profile. If earnings decline dueto rate or volume pressures, causing funds flow from operations tototal debt to fall to below 10% or debt to EBITDA to rise above5.5x, S&P could lower its ratings.

"We consider an upgrade unlikely over the near term due to theneed to replace business that is being shifted from a keycustomer, and the weak economic environment," she continued.

As reported by the Troubled Company Reporter on November 20, 2009,Moody's Investors Service downgraded U.S. Concrete's corporatefamily rating and probability of default rating to Caa1 from B2,its senior subordinated notes to Caa2 from B3, its speculativegrade liquidity rating to SGL-4 from SGL-2, and changed the ratingoutlook to negative from stable. The downgrades reflect continuedvolume deterioration of ready-mixed concrete and precast concrete,resulting from weak construction activity across all marketsegments. Moody's believes that non-residential construction willdecline in 2010 and ready-mixed concrete prices will weaken. As aresult, the company's profitability is expected to continue tosuffer and its debt-to-EBITDA leverage to remain elevated over thenext year. The downgrades also reflect weakened liquidity and thepotential for credit agreement covenant violations in 2010.

On November 17, the TCR said Standard & Poor's Ratings Serviceslowered its corporate credit rating on U.S. Concrete to 'CCC+'from 'B-'. At the same time, S&P lowered the issue-level ratingon the company's senior subordinated notes due 2014 to 'CCC' (onenotch below the corporate credit rating) from 'CCC+'. Therecovery rating is '5', indicating S&P's expectation of modestrecovery (10%-30%) in the event of a payment default. The outlookis negative.

"The downgrade reflects S&P's concern regarding U.S. Concrete'sdeteriorating operating performance as a result of depressedcommercial construction activity and S&P's expectations that thecompany's liquidity profile will further weaken for the remainderof 2009 and into 2010," said Standard & Poor's credit analystTobias Crabtree.

The Company swung to a net loss of $61,298,000 for the threemonths ended September 30, 2009, from net income of $1,906,000 forthe year ago period. The Company posted a net loss of $77,140,000for the nine months ended September 30, 2009, from a net loss of$2,898,000 for the year ago period.

At September 30, 2009, the Company had $425,208,000 in totalassets against $418,443,000 in total liabilities. Retaineddeficit was $264,072,000 at September 30, 2009.

UTGR INC: Taps John McLaughlin to Supervise Twin River Operations-----------------------------------------------------------------Paul Grimaldi at The Providence Journal reports that the U.S.bankruptcy court will let UTGR Inc.'s Twin River slot parlor tohire John J. McLaughlin, formerly president of Centaur Gaming, tooversee operations at the Lincoln gambling venue. Court documentssay that Mr. McLaughlin will advise the lenders taking over thefinancially troubled slot parlor on how to improve Twin River'soperations in advance of a potential sale. According to TheJournal, Mr. McLaughlin will evaluate Twin River's physicalcondition, analyze its spending and revenue, and review itsmarketing and entertainment programs. The Journal relates thatunder the terms of a six-month contract, Mr. McLaughlin will bepaid $30,000 monthly, plus expenses. Mr. McLaughlin needs anoperator's license from the Rhode Island Department of BusinessRegulation.

Paul Grimaldi at The Journal relates that the Twin River slotparlor's lawyers sought court authorization to transfer theownership of the Lincoln gambling venue by October 23 to its majorlenders. The Journal states that as part of the transitionagreement negotiated between the slot parlor's owners, its lendersand the State of Rhode Island, the UTGR board of directors willleave their post. The report says that the state and the majorlenders will each appoint one member to an oversight board.

At September 30, 2009, the Company's consolidated balance sheetsshowed $1.004 billion in total assets, $707.0 million in totalliabilities, and $297 million in total stockholders' equity.

The Company incurred net losses of $150.3 million, $195.6 millionand $117.3 million during the years ended December 31, 2008, 2007,and 2006, respectively. During the nine months endedSeptember 30, 2009, the Company incurred a net loss of$186.3 million. The Company recorded operating losses in 18 ofthe 19 consecutive quarters in the period ended September 30,2009. At September 30, 2009, the Company had an accumulateddeficit of $1.03 billion. The Company incurred net cash outflowsfrom operations of $55.2 million and $225.1 million in 2008 and2007 respectively. Cash used in operations was $89.2 millionduring the nine months ended September 30, 2009. The Companysaid it expects to continue to incur losses and negative cashflows from operations over at least the remainder of 2009.

The Company's only committed source for borrowings is a creditfacility in China. During the third quarter of 2009, a$263.5 million credit facility expired and was not renewed. Theremaining approximately $58.6 million credit facility expires inthe fourth quarter of 2009.

While improvements in operating results, cash flows and liquidityare anticipated as management's initiatives to control and reducecosts while maintaining and growing its revenue base are fullyimplemented, the Company believes its recurring losses andexpected negative cash flows from operations raise substantialdoubt about its ability to continue as a going concern. TheCompany's independent registered public accounting firm includedan explanatory paragraph highlighting this uncertainty in theCompany's annual Report on Form 10-K for the year endedDecember 31, 2008.

About UTStarcom

UTStarcom, Inc. (Nasdaq: UTSI) -- http://www.utstar.com/-- is a global leader in IP-based, end-to-end networking solutions andinternational service and support. The Company sells itssolutions to operators in both emerging and establishedtelecommunications markets around the world. UTStarcom enablesits customers to rapidly deploy revenue-generating access servicesusing their existing infrastructure, while providing a migrationpath to cost-efficient, end-to-end IP networks. The Company wasfounded in 1991 and is headquartered in Alameda, California.

UTSTARCOM INC: Shah Capital Management Discloses 6.25% Stake------------------------------------------------------------Shah Capital Management disclosed it holds in the aggregate8,004,957 shares or roughly 6.25% of the common stock ofUTStarcom, Inc., as of December 4, 2009.

Going Concern Doubt

At September 30, 2009, the Company's consolidated balance sheetsshowed $1.004 billion in total assets, $707.0 million in totalliabilities, and $297 million in total stockholders' equity.

The Company incurred net losses of $150.3 million, $195.6 millionand $117.3 million during the years ended December 31, 2008, 2007,and 2006, respectively. During the nine months endedSeptember 30, 2009, the Company incurred a net loss of$186.3 million. The Company recorded operating losses in 18 ofthe 19 consecutive quarters in the period ended September 30,2009. At September 30, 2009, the Company had an accumulateddeficit of $1.03 billion. The Company incurred net cash outflowsfrom operations of $55.2 million and $225.1 million in 2008 and2007 respectively. Cash used in operations was $89.2 millionduring the nine months ended September 30, 2009. The Companysaid it expects to continue to incur losses and negative cashflows from operations over at least the remainder of 2009.

The Company's only committed source for borrowings is a creditfacility in China. During the third quarter of 2009, a$263.5 million credit facility expired and was not renewed. Theremaining approximately $58.6 million credit facility expires inthe fourth quarter of 2009.

While improvements in operating results, cash flows and liquidityare anticipated as management's initiatives to control and reducecosts while maintaining and growing its revenue base are fullyimplemented, the Company believes its recurring losses andexpected negative cash flows from operations raise substantialdoubt about its ability to continue as a going concern. TheCompany's independent registered public accounting firm includedan explanatory paragraph highlighting this uncertainty in theCompany's annual Report on Form 10-K for the year endedDecember 31, 2008.

About UTStarcom

UTStarcom, Inc. (Nasdaq: UTSI) -- http://www.utstar.com/-- is a global leader in IP-based, end-to-end networking solutions andinternational service and support. The Company sells itssolutions to operators in both emerging and establishedtelecommunications markets around the world. UTStarcom enablesits customers to rapidly deploy revenue-generating access servicesusing their existing infrastructure, while providing a migrationpath to cost-efficient, end-to-end IP networks. The Company wasfounded in 1991 and is headquartered in Alameda, California.

VERMILLION INC: Disclosure Statement Approved for Voting--------------------------------------------------------Bill Rochelle at Bloomberg News reports that Vermillion Inc. isnow soliciting votes for its reorganization plan after it obtainedapproval of the explanatory disclosure statement. At the hearingon Dec. 8, the judge didn't bend to an objection by shareholderscontending they were entitled to vote in view of the potential fora "massive dilution" of their stockholding.

The Plan calls for holders of $2.365 million in 4.5% notes to bepaid in cash or elect to take new stock. The holders of $12.1million in 7% unsecured notes can choose between having the debtreinstated or taking new stock. Existing shareholders wouldretain their stock while $2 million in unsecured debt would bepaid in full.

The confirmation hearing for approval of the plan is tentativelyset for Jan. 7.

Vermillion, Inc. -- http://www.vermillion.com/-- is dedicated to the discovery, development and commercialization of novel high-value diagnostic tests that help physicians diagnose, treat andimprove outcomes for patients. Vermillion, along with itsprestigious scientific collaborators, has diagnostic programs inoncology, hematology, cardiology and women's health. Vermillionis based in Fremont, California.

The Company filed for Chapter 11 on March 30, 2009 (Bankr. D. Del.Case No. 09-11091). Francis A. Monaco Jr., Esq., and Mark L.Desgrosseilliers, Esq., at Womble Carlyle Sandridge & Rie, PLLC,represent the Debtor as counsel. At September 30, 2008, theDebtor had $7,150,000 in total assets and $32,015,000 in totalliabilities.

VIRGIN MOBILE: Cancels Registration of Class A Common Stock-----------------------------------------------------------Virgin Mobile USA, Inc., filed with the Securities and ExchangeCommission a Form 15 to terminate the registration of its Class ACommon Stock, par value $0.01 per share, and suspend its duty tofile reports.

Pursuant to the Agreement and Plan of Merger, dated as of July 27,2009, by and among Virgin Mobile USA, Sprint Nextel Corporationand Sprint Mozart, Inc., a wholly owned subsidiary of SprintNextel, Merger Sub merged with and into Virgin Mobile USA with theCompany continuing as the surviving corporation in the merger as awholly owned subsidiary of Sprint Nextel.

About Virgin Mobile USA

Based in Warren, New Jersey, Virgin Mobile USA, Inc., is a mobilevirtual network operator, commonly referred to as an MVNO,offering prepaid, or pay-as-you-go, and, following the acquisitionof Helio LLC in August 2008, postpaid wireless communicationsservices, including voice, data, and entertainment content,without owning a wireless network. The Company uses the "VirginMobile" name and logo under license from Virgin Enterprises Ltd.The Company offers its services over the nationwide Sprint PCSnetwork under the terms of the Amended and Restated PCS ServicesAgreement between the Company and Sprint Nextel. The Companyconducts its business within one operating segment.

Net income attributable to Virgin Mobile USA common stockholderswas $8.0 million for the three months ended September 30, 2009,from net income of $3.7 million for the year ago period. Netincome attributable to Virgin Mobile USA common stockholders was$38.2 million for the nine months ended September 30, 2009, fromnet income of $12.0 million for the year ago period.

Total operating revenue was $293.0 million for the three monthsended September 30, 2009, from $326.5 million for the same perioda year ago. Total operating revenue was $937.9 million for thenine months ended September 30, 2009, from $976.4 million for thesame period a year ago.

As of September 30, 2009, Virgin Mobile had $307.4 million intotal assets against $551.6 million in total liabilities. As ofSeptember 30, 2009, total deficit was $244.2 million.

WABASH NATIONAL: Zachman Quits as SVP & Chief Operating Officer---------------------------------------------------------------Wabash National Corporation reports that Joseph M. Zachman, SeniorVice President and Chief Operating Officer, on December 1, 2009,resigned from the Company effective immediately. Mr. Zachman hasbeen a key member of the Company's leadership team for the pastfour and a half years and has contributed greatly to improve theoverall operational execution of our manufacturing businesses.

However, in light of the current economic environment, includingthe depressed demand levels within the trailer industry, theCompany is continuously challenged to look at its organizationalstructure to assure it is sized properly and effectively for thecurrent operating environment. Mr. Zachman's resignation is aresult of this depressed demand environment. Mr. Zachman isexpected to execute a general release and receive the severancebenefits.

On December 7, Wabash National filed Amendment No. 3 to its FormS-1 Registration Statement under the Securities Act of 1933 todelay the effective date of the Registration Statement. TheRegistration Statement and accompanying prospectus relates to theoffer and sale from time to time of up to 24,762,636 shares of theCompany's common stock by selling stockholder, or its donees,pledgees, transferees or other successors-in-interests. Theshares of common stock being sold are originally issuable upon theexercise of a warrant held by the selling stockholder, or itsdonees, pledgees, transferees or other successors-in-interests.The Company will not receive any of the proceeds from the sale ofthese shares, but will incur expenses in connection with theoffering.

As reported by the Troubled Company Reporter, Wabash on July 17,2009, entered into a Third Amended and Restated Loan and SecurityAgreement, which was effective August 3, 2009, with Bank ofAmerica, N.A., as a lender and as agent and the other lenderparties. The Credit Agreement has a maturity date of August 3,2012. The Amended Facility has a capacity of $100 million,subject to a borrowing base, and borrowings outstanding totaled$25.5 million at August 3, 2009. The lenders waived certainevents of default that had occurred under the previous creditfacility and waived the right to receive default interest duringthe time the events of default had continued.

At September 30, 2009, the Company's consolidated balance sheetsshowed $240.5 million in total assets, $176.7 million in totalliabilities, $19.4 million in preferred stock, and $44.4 millionin shareholders' equity.

The Company reported current assets of $88.4 million and currentliabilities of $138.0 million at September 30, 2009, resulting ina working capital deficit of $49.6 million.

About Wabash National

Headquartered in Lafayette, Indiana, Wabash National Corporationis one of the leading manufacturers of semi-trailers in NorthAmerica. Established in 1985, the company specializes in thedesign and production of dry freight vans, refrigerated vans,flatbed trailers, drop deck trailers, dump trailers, truck bodiesand intermodal equipment. Its innovative core products are soldunder the DuraPlate(R), ArcticLite(R), FreightPro(TM) Eagle(R) andBenson(TM) brand names. The company operates two wholly ownedsubsidiaries; Transcraft (R) Corporation, a manufacturer offlatbed, drop deck, dump trailers and truck bodies; and WabashNational Trailer Centers, trailer service centers and retaildistributors of new and used trailers and aftermarket partsthroughout the U.S.

WORLDSPACE INC: Has Until January 31 to File Chapter 11 Plan------------------------------------------------------------The Hon. Peter J. Walsh of the U.S. Bankruptcy Court for theDistrict of Delaware extended Worldspace Inc., et al.'s exclusiveperiod to file their Chapter 11 plan and to solicit acceptances ofthat plan until January 31, 2010, and April 1, 2010.

The Debtors and their affiliates operate two geostationarysatellites, AfriStar and Asia Star, which are in orbit over Africaand Asia. The Debtor and two of its affiliates filed for Chapter11 bankruptcy protection on October 17, 2008 (Bankr. D. Del., CaseNo. 08-12412 - 08-12414). James E. O'Neill, Esq., Laura DavisJones, Esq., and Timothy P. Cairns, Esq., at Pachulski Stang Ziehl& Jones, LLP, represent the Debtors as counsel. Neil RaymondLapinski, Esq., and Rafael Xavier Zahralddin-Aravena, Esq., atElliot Greenleaf, represent the Official Committee of UnsecuredCreditors. When the Debtors filed for bankruptcy, they listedtotal assets of $307,382,000 and total debts of $2,122,904,000.

YMCA OF DUTCHESS COUNTY: Files in Poughkeepsie, New York--------------------------------------------------------The Young Men's Christian Association of Dutchess County filed forChapter 11 (Bankr. S.D.N.Y. Case No. 09-38454) in the face offoreclosure by Mahopac National Bank. The YMCA in Poughkeepsie,New York, listed assets and debt both totaling about $1.5 million.Secured debt is $1.1 million.

YRC WORLDWIDE: Gets NASDAQ Exception in Debt for Equity Exchange----------------------------------------------------------------YRC Worldwide Inc. on December 8, 2009, said it has received anexception from the NASDAQ Listing Qualifications Departmentrelating to shareholder approval of the issuance of up to42 million shares of the Company's common stock and up to5 million shares of the Company's new Class A convertiblepreferred stock in the Company's pending exchange offer of itscontingent convertible senior notes and USF-8 1/2% notes with anaggregate face value of approximately $536.8 million.

Assuming full participation in the exchange offer, the holders ofthe outstanding notes will own 95% of the Company's common stock(and voting power) on an as-if converted basis following theexchange offer. The exception granted by NASDAQ allows YRCWcommon stock to continue to be listed and traded on the NASDAQexchange following the completion of the debt for equity exchange.

In connection with the transactions contemplated by the exchangeoffer, the Company requested and on December 8, 2009, receivedfrom NASDAQ an exception from certain NASDAQ shareholder approvalrules pursuant to the "financial viability exception" set forth inNASDAQ Listing Rule 5635(f). Absent this exception, NASDAQListing Rules would have required shareholder approval prior tothe issuance of the shares of the Company's common stock and ClassA convertible preferred stock to be issued in the exchange offer.To obtain this exception, the Company was required to demonstrateto NASDAQ that the delay associated with the effort to secureshareholder approval would have seriously jeopardized theCompany's financial viability.

As also required by NASDAQ, on November 20, 2009, the Audit/EthicsCommittee of the Company's Board of Directors expressly approvedthe Company's reliance on this exception. A notice toshareholders regarding the Company's reliance on the financialviability exception was mailed to shareholders in accordance withNASDAQ Listing Rules. A full-text copy of the Notice is availableat no charge at http://ResearchArchives.com/t/s?4b7d

Bankruptcy Warning

As reported in the Troubled Company Reporter on November 11, 2009,YRC Worldwide told investors it would file for bankruptcy if itcannot complete a $536 million debt exchange offer that willenable it to tap into a $106 million revolver credit reserve.

YRC said the uncertainty regarding its ability to generatesufficient cash flows and liquidity to fund operations raisessubstantial doubt about its ability to continue as a goingconcern.

YRC reported a net loss of $158.7 million for the three monthsended September 30, 2009, from a net loss of $720.8 million forthe same period a year ago. The Company posted a net loss of741.5 million for the nine months ended September 30, 2009, from anet loss of $731.4 million for the same period a year ago.

At September 30, 2009, the Company had $3.281 billion in totalassets against total current liabilities of $1.687 billion, long-term debt, less current portion of $892.0 million, deferredincome taxes, net of $131.4 million, pension and post retirementof $384.9 million, and claims and other liabilities of$410.2 million, resulting in shareholders' deficit of$225.5 million.

About YRC Worldwide

Headquartered in Overland Park, Kansas, YRC Worldwide Inc. --http://www.yrcw.com/-- a Fortune 500 company and one of the largest transportation service providers in the world, is theholding company for a portfolio of successful brands includingYRC, YRC Reimer, YRC Glen Moore, YRC Logistics, New Penn, Hollandand Reddaway. YRC Worldwide has the largest, most comprehensivenetwork in North America with local, regional, national andinternational capabilities. Through its team of experiencedservice professionals, YRC Worldwide offers industry-leadingexpertise in heavyweight shipments and flexible supply chainsolutions, ensuring customers can ship industrial, commercial andretail goods with confidence.

YRC WORLDWIDE: Has Significant Support for Debt-For-Equity Offers-----------------------------------------------------------------YRC Worldwide Inc. has extended its offer to exchange up to42 million shares of the Company's common stock and up to5 million shares of the Company's new Class A convertiblepreferred stock for its outstanding contingent convertible seniornotes and the USF-8 1/2% notes due 2010 issued by the Company'ssubsidiary, YRC Regional Transportation, Inc., with an aggregateface value of approximately $536.8 million, until 11:59 p.m., NewYork City time, on December 15, 2009, unless further extended bythe Company.

The exchange offer had been scheduled to expire at 11:59 p.m., NewYork City time, on December 8, 2009.

On December 9, 2009, YRC Worldwide said a significant number ofits note holders have tendered their notes pursuant to thecompany's debt-for-equity exchange offers. The company extendedthe expiration date for the exchange offers to provide additionaltime for all conditions to the offers to be met. YRC said theSecurities and Exchange Commission has continued to review thecompany's Registration Statement on Form S-4 relating to theexchange offers and has not yet declared the RegistrationStatement effective, which is a condition of the offers, amongothers.

The company said that it is encouraged by the response to theexchange offers, which the company commenced following severalmonths of ongoing, active implementation of its comprehensiveplan. The plan is designed to place the company on a more solidfinancial base with an enhanced capital structure and improvedoperations and cost structure, making it more competitive and wellpositioned to take advantage of any upturn in the economy.

As of 11:59 p.m. on December 8, 2009, note holders tendered atotal of 72% of the aggregate principal amount of the outstandingnotes pursuant to the exchange offers, which is below the minimumpercentage required as a condition to the offers.

The company will exchange the notes for shares of the company'scommon stock and new Class A convertible preferred stock in suchamounts as are set forth in the company's Registration Statementon Form S-4, as amended, that the company originally filed withthe SEC on November 9, 2009, which together on an as-if convertedbasis, if the note holders tender all of the outstanding notes inthe exchange offers, would represent approximately 95% of thecompany's issued and outstanding common stock.

To validly tender their notes, the participating note holders willbe required to become party to a mutual release with the companyand consent to an amendment of the terms of the notes that wouldremove substantially all of the material covenants other than theobligation to pay principal and interest on the notes and thoserelating to the conversions rights of convertible notes, andeliminate or modify the related events of default.

Rothschild, Inc. and Moelis & Company LLC are acting as leaddealer managers in connection with the exchange offer. Holders ofthe notes may contact Rothschild at (800) 753-5151 (U.S. toll-free) or collect at (212) 403-3716 and Moelis at (866) 270-6586(U.S. toll-free) or collect at (212) 883-3813 with any questionsthey may have regarding the exchange offers.

Bankruptcy Warning

As reported in the Troubled Company Reporter on November 11, 2009,YRC Worldwide told investors it would file for bankruptcy if itcannot complete a $536 million debt exchange offer that willenable it to tap into a $106 million revolver credit reserve.

YRC said the uncertainty regarding its ability to generatesufficient cash flows and liquidity to fund operations raisessubstantial doubt about its ability to continue as a goingconcern.

YRC reported a net loss of $158.7 million for the three monthsended September 30, 2009, from a net loss of $720.8 million forthe same period a year ago. The Company posted a net loss of741.5 million for the nine months ended September 30, 2009, from anet loss of $731.4 million for the same period a year ago.

At September 30, 2009, the Company had $3.281 billion in totalassets against total current liabilities of $1.687 billion, long-term debt, less current portion of $892.0 million, deferredincome taxes, net of $131.4 million, pension and post retirementof $384.9 million, and claims and other liabilities of$410.2 million, resulting in shareholders' deficit of$225.5 million.

About YRC Worldwide

Headquartered in Overland Park, Kansas, YRC Worldwide Inc. --http://www.yrcw.com/-- a Fortune 500 company and one of the largest transportation service providers in the world, is theholding company for a portfolio of successful brands includingYRC, YRC Reimer, YRC Glen Moore, YRC Logistics, New Penn, Hollandand Reddaway. YRC Worldwide has the largest, most comprehensivenetwork in North America with local, regional, national andinternational capabilities. Through its team of experiencedservice professionals, YRC Worldwide offers industry-leadingexpertise in heavyweight shipments and flexible supply chainsolutions, ensuring customers can ship industrial, commercial andretail goods with confidence.

* Commercial Mortgage Defaults Rise to 3.4% in Quarter------------------------------------------------------The default rate on commercial mortgages more than doubled in thethird quarter to 3.4 percent from 1.37 percent a year earlier,Bill Rochelle reported, citing a report from Real EstateEconometrics LLC.

* Fitch Reports Improved High Yield Default Outlook; Risks Linger-----------------------------------------------------------------Fitch Ratings projects that the U.S. high yield default rate willcontinue to decline in 2010 to a range of 6%-7% by year-end, amarked improvement from 2009's results but still above the long-term average annual rate of 4.7%.

The pace of U.S. high yield defaults slowed considerably in thesecond half of 2009 with both the number of issuers defaulting ontheir debt obligations and the par value of bonds affected by thedefaults falling by half compared with the difficult first sixmonths of the year. After soaring to 9.5% in June, with 103issuers defaulting on a combined $79.7 billion in bonds, defaultsfell to 42 issuers affecting $36.8 billion in bonds from July toNovember, resulting in a November year-to-date default rate of13.6% (on $116.5 billion). Fitch believes that with additionaldefaults in December, the default rate will end 2009 just shy ofthe lower end of the agency's full year forecast of 15%-18%.

'Pressure on corporate credit quality has continued to ease in2009 with downgrades steadily retreating quarter over quarter,'said Mariarosa Verde, Managing Director of Fitch Credit MarketResearch. 'While upgrades are still limited, encouraging economicdata and a return to more normal credit market activity has causedspreads to tighten to summer 2008 levels, a reflection of themarket's improved risk appetite and confidence.'

Fitch's data shows that corporate downgrades fell again in Octoberand November, contracting some 35% compared with the third quarterand following a 50% dip in the third quarter. Rating trends havereflected broader market developments with both economic andfunding conditions coming back from the brink earlier in the year.Another positive sign emerged in October when the Federal ReserveSenior Loan Officer Survey showed fewer banks tightening standardson commercial and industrial loans than in previous quarters (15%of respondents reported tightening standards, down by half fromthe July survey and far less than the extraordinary spike of morethan 80% recorded in the fall of 2008). However, the recentsurvey still showed net tightening, suggesting that as with otherhopeful developments, much is still riding on the sustainabilityand strength of the recovery going into 2010.

Continued progress on the economic front is critical, more so thanin prior recessions because leverage overall remains high and, asdescribed more fully below, a considerable number of defaults overthe past year have been in the form of out of court debt exchangeswhich, while offering some debt relief, have not cut debt to thesame extent as formal bankruptcy. Earlier research conducted byFitch showed that the average high yield company that defaultedand emerged from bankruptcy from 2000 to 2006, emerged with just athird of its pre-bankruptcy debt. In contrast to this, recentdebt exchanges have generally left the affected companies stillsaddled with high debt burdens, evidenced by the fact that mostremain rated 'CCC' or lower following the exchange.

'A concern going into 2010 is not only the risk of new defaultsbut also a heightened risk of serial defaults,' Verde added. 'Ifgrowth proves weak, some of the debt restructuring measuresadopted over the past year may have only been successful inhelping companies defer rather than avoid bankruptcy.'

Fitch finds that at the end of November, 'CCC' rated issuescontinued to represent a sizeable 30% of the U.S. high yieldmarket (and with issues rated 'B-', 40%). Of the $230 billion in'CCC' paper still outstanding, more than a third is associatedwith companies that have already done some type of debt exchange,but even excluding these companies, the 'CCC' pool remains large.This illustrates that there is still substantial defaultvulnerability if anticipated economic growth does not occur.

In addition while there has been an impressive rebound in highyield bond issuance in 2009, a closer look reveals that theissuance has had a strong conservative streak. A record 41% ofissuance has consisted of senior secured bonds. Also 'CCC' ratedissuance, the ultimate litmus test of the market's risk appetitehas made up just 9% of new bonds -- sharply lower than the shareof the market rated 'CCC'.

Fitch finds that defaults in 2009 have been accompanied by dismalrecovery rates. To date, the weighted average recovery rate on2009 defaults is 26% of par. However, as with other years,recovery rates have been uneven.

'The weighted average recovery rate on distressed debt exchangeshas averaged 39% of par in 2009, nearly twice the 23% raterecorded on the rest of the year's defaults,' said Eric Rosenthal,Senior Director of Fitch Credit Market Research.

Recovery rates were particularly grim in the first half of theyear but, as expected with a rebounding equity market and adeceleration in defaults, bounced back in the second half. Fitchexpects recovery rates to continue to firm in 2010 with recoveryrates more in line with historical averages of 30% to 40%.

Despite a new annual high in the dollar value of high yield bonddefaults (according to Fitch's U.S. High Yield Default Index theprevious peak was 2002's $109.8 billion), several technicaldevelopments put downward pressure on the default rate in 2009.First, an unprecedented share of defaults (30% of the year'sdefaulted issuers) consisted of distressed debt exchanges ratherthan bankruptcy filings. Fitch estimates that this shaved 1% offthe default rate since, in contrast to a bankruptcy filing, notall outstanding debt was affected by the exchanges. In addition,the high yield market grew a surprising 10% in size as new bondsissued as part of the exchanges quickly returned to the universeof performing issues and as the high yield bond market absorbed$62 billion in new secured bonds, the majority issued to refinanceexisting leveraged loans. The growth in the market's sizededucted an additional 1% from the year's default rate.

* Fitch Reports Steady Outlook Aerospace & Defense; Risks Remain----------------------------------------------------------------Credit quality in the U.S. commercial aerospace industry willremain under pressure in 2010, while the U.S. defense sector islikely to experience more stability, according to Fitch Ratings.Fitch expects deliveries in all commercial aerospace originalequipment segments to decline in 2010, but aftermarket salesshould begin to improve modestly. Defense spending will continueto grow in the low single digits.

Credit metrics for many A&D companies deteriorated in 2009, butthey are likely to be steady in 2010. Profits and cash flowscould be helped by improvement in the high-margin aftermarket, thefull-year impact of 2009 cost reductions, and defense growth, butthey will be held back by higher pension expense and weakcommercial OE markets. Fitch says liquidity remains strong afterimproving in 2009 because of lower share repurchases and someopportunistic debt issuance, but the company expects cashdeployment will increase during 2010, particularly foracquisitions and pension contributions.

Key risks for the sector include the weak global economicrecovery, exogenous shocks (terrorism, disease pandemic, etc.),large U.S. government deficits, and execution on new programs.The 787 program remains a continuing source of risk for Boeing andits suppliers. Flight hours and airline traffic have moved off ofcyclical lows, but they remain at depressed levels. A generalrisk is that some production rates have not been revised downwardmaterially despite the weak economy. Fitch does not expect thatfinancing availability will be a limit on aircraft deliveries in2010, although some concerns remain in the aircraft financebusiness. Longer-term, Fitch considers the commercial outlooksolid because of large backlogs and the need to build aerospaceinfrastructure in developing regions.

-- Large Commercial Aircraft: Fitch expects LCA deliveries from Boeing and Airbus will decline approximately 5% in 2010 to 920 aircraft, with revenues down 5%-10%. These estimates incorporate the announced production cuts for the A320 family (down two aircraft per month) and B777 (down almost 30%), but they exclude possible 787 deliveries (discussed below). Fitch believes there is a strong chance of additional production cuts, but these are more likely to take place in 2011. Long manufacturing lead times, advance payment requirements, and indications of sold-out 2010 production schedules support the argument against additional cuts next year, unless they are announced in the next few months to take effect at the end of 2010.

Fitch's forecasts will include additional 5%-15% cuts beginning in2011. Fitch forecasts the additional LCA production reductions in2011 because of a moderate global economic recovery, airlinecapacity reductions in 2008 and 2009, substantial airline losses,and deliveries that are exceeding typical aircraft retirements.However, the eventual production declines should be moderaterelative to prior LCA cycles as a result of large backlogs,production restraint since the last downturn, some remainingoverbooking in the delivery plans, and the geographic diversity ofthe customer base. In addition, the long-term nature of aircraftassets, as well as operating cost savings, provide incentive forcustomers to continue taking delivery of aircraft despitecyclically weak airline traffic. If the projected production cutsare managed with sufficient lead time, both the manufacturers andthe supply base should be able to adjust their cost structures intime to prevent deterioration of their credit profiles.

Fitch expects LCA orders to be low in 2010 and 2011, acontinuation of the trend in 2009, in which there have been only287 net orders through November compared to 867 deliveries duringthe same period. There were 142 cancellations through November,and Boeing has indicated that it had approximately 215 deferralsin the first three quarters. Low orders are not a credit concerngiven that Boeing and Airbus had a combined backlog of 6,849aircraft at the end of November, equal to more than seven years ofproduction at estimated 2010 rates. Excluding 787 and A350backlogs, the industry still has almost six years worth of orders.

Boeing's 787 program will continue to be a key concern for the LCAsector and its supply base in 2010. If Boeing meets its currentschedule, Fitch estimates the company could deliver 10-15 787s inlate 2010, but there is considerable risk to the schedule,including an aggressive flight testing program, certification, andthe production ramp-up. Boeing will be building 787s through theflight testing program, exposing the company to the risk ofreworking some aircraft if problems are discovered during theflight tests. Uncertainty over customer penalties and supplierclaims add to the 787s risks. Through November, the 787 accountedfor the bulk of Boeing's order cancellations (83 out of 111),although the company still has 840 firm orders for the aircraft.

-- Commercial Aftermarket/Services: The commercial aftermarket will likely be the first part of the aerospace industry to recover from the downturn. Fitch forecasts aftermarket spending will be flat to up 5% in 2010, with a weak first half offset by an improved second half. The expected economic rebound should drive airline traffic growth and eventually will lead to rising flight hours and capacity, which are the primary drivers of aftermarket spending. Some inventory rebuilding and completion of deferred maintenance should also help the aftermarket recover in 2010. Business jet utilization has also been improving off of a low base, which will aid aftermarket spending in that sector.

Fitch's general concern for the aftermarket is that currentconditions are still very weak, with many companies reportingdouble digit declines year-over-year in the third quarter. Somecapacity metrics are still negative despite indications ofincreased airline traffic. Fitch will have more conviction on theoutlook for this sector once capacity starts to increase.Companies with healthy exposures to this high-margin segmentinclude Goodrich, Honeywell, Rockwell Collins, Transdigm, andUnited Technologies.

-- The business jet market was the worst commercial aerospace sector in 2009, suffering a rapid and severe downturn. Industry deliveries fell 38% through September, and Fitch expects a 35%-40% unit decline for the year, with revenues likely down 25%-30%. An eventual peak-to-trough unit decline of 50% or more for the industry is not out of the question, and Fitch expects aircraft deliveries to fall another 5%-10% in 2010 from 2009 levels. The large unit declines result from hundreds of order cancellations and the failure of light jet manufacturer Eclipse Aviation.

Although utilization rates have started to rise and corporateprofits have turned up, Fitch expects continued weakness in thesector because utilization rates are still well below peak levelsand the corporate profit improvement is largely due to costcutting. This sector will continue to be volatile because of thediscretionary nature of the product, the availability of numeroussubstitute forms of travel, and the relationship to corporateprofits. A key development in the sector in the past five yearshas been strong orders from outside North America, and theseinternational orders could be the catalyst for an upturn beyond2010. Manufacturers in this sector include Bombardier, DassaultAviation, Embraer, General Dynamics, Hawker Beechcraft, andTextron, as well as key suppliers such as Honeywell.

-- The regional aircraft market (regional jets and turboprops) has many of the same drivers as the LCA market, but it has lower backlogs. Orders so far in 2009 have been weak, and the outlook for this sector is negative for 2010. Regional jets deliveries from Bombardier and Embraer will probably fall about 15% in 2009 and at least 15% in 2010, excluding possible deliveries from new entrants in the market. Fitch estimates that turboprop deliveries from Bombardier and ATR (a joint venture between EADS and Finmeccanica) will rise modestly in 2009, but they will likely decline 5% in 2010. New entrants into the regional jet market remain an important part of the sector's outlook, and in 2010 the market will likely see the initial deliveries of Sukhoi's Superjet 100 and China's ARJ21.

Defense:

High U.S. DoD spending levels continue to support defense sectorcredit quality, and the outlook is still favorable in the nearterm because spending in fiscal year 2010 will continue to rise.The core DoD budget should grow approximately 4% in FY2010, andmodernization spending (procurement plus R&D), the most relevantpart of the budget for defense contractors, should be up 2%-3%.Fitch believes that FY2010 is probably the peak in modernizationspending, and there are several risks to monitor in FY2011 andbeyond. These include the Obama Administration's first fullbudget in FY2011, the Quadrennial Defense Review, and the largeprojected federal budget deficits in FY2009-FY2011. In additionto spending levels, some other changes proposed by the newadministration could have a detrimental impact on defensecontractors, including acquisition reform and the 'insourcing' ofservices previously contracted out by the DoD.

Fitch believes core modernization spending could decline 1%-2% inFY2011, although the overall core budget could rise. The FY2011budget and QDR will likely continue the changes the Obamaadministration introduced in the current year's budget, and Fitchis not anticipating any dramatic shifts. Fitch expectssupplemental spending that supports operations in Iraq andAfghanistan will fall over the next several years, but for severalreasons the decline will be gradual, and the supplemental spendingwill not disappear. Spending related to Iraq will be down, butspending in Afghanistan will increase. Some security spending bythe U.S. in Iraq will likely be replaced by Iraqi governmentspending, which could continue to be a source of revenues to U.S.contractors. Finally, the DoD will need to refurbish or replacesome equipment and material that is in poor condition or left inIraq.

Given the strong credit metrics and liquidity at most of theleading defense contractors, ratings in the sector are unlikely tobe pressured by modest declines in modernization spending.Program execution and cash deployment probably present greaterrisks. Defense company backlogs fell in the first three quartersof 2009 due to some program cancellations, although orders in thefourth quarter could reverse some of the decline.

Liquidity and Cash Deployment:

Strong liquidity and financial flexibility helped the NorthAmerican A&D industry withstand the difficult economy in 2009, andthe industry even improved its liquidity position in the past 12months, although at the expense of increasing total debt to$60 billion from $55 billion. At the end of the third quarter thetop 15 A&D companies rated by Fitch in North America had$35 billion in cash compared to approximately $5 billion incurrent debt maturities and short-term debt. The only materialcredit facilities set to expire in 2010 (GD, L-3, and RTN) havealready been replaced.

Many companies in the sector pulled back on discretionaryexpenditures in 2009 (share repurchases fell $10 billion, forexample) in the interests of building liquidity. Withstabilization appearing in some parts of the A&D sector, Fitchexpects greater cash deployment in 2010. Acquisition activitybegan to increase in the past quarter, and Fitch expects this willcontinue in 2010. Share repurchases and dividend increases willlikely rise as well.

Higher pension contributions will be another use of cash in 2010.The A&D sector has seven of the largest 25 pension plans incorporate America, and some are significantly underfunded. Thesituation is mitigated for defense contractors, which get somerecovery of pension costs in government contracts. Harmonizationof Cost Accounting Standards and the Pension Protection Act issomething to watch during 2010.

In Fitch's view, Boeing will have the most significant liquiditypressures in 2010. Delays in the 787 and 747-8 programs over thepast 18 months have negatively affected Boeing's credit qualitybecause of inventory build-up, delayed advance payments, andhigher development expenses. Cash flow pressures will likelypersist into 2011 due to continued inventory build-up in supportof initial 787 deliveries. Although free cash flow will probablybe positive in 2009, Fitch believes that break-even or negativefree cash flow is possible in 2010 depending on the ultimateschedule for 787 deliveries, production rates on other aircraftmodels, and the company's working capital management, which hasbeen good in 2009 considering the 787 inventory pressures andreduced advances because of lower orders.

Aircraft Finance:

Fitch does not expect that financing availability will be a limiton aircraft deliveries in 2010, although some concerns remain inthe aircraft finance business. The aircraft finance market wasnot as bad as feared in 2009, and Fitch expects this trend tocontinue because credit markets have improved and lower forecastedaircraft deliveries will mean a lower financing requirement thanin 2009. Fitch projects funding requirements will be$60-$65 billion for LCA and regional aircraft in 2010, about$5 billion lower than in 2009. An additional $10-$15 billioncould be needed for business jets, also down versus 2009.

Concerns in the aircraft finance market include the damagedbusiness models of some large aircraft lessors, the exit of somebanks from the market, and indications that pre-delivery paymentfinancing was difficult for some airlines in 2009. Severalfactors offset these concerns, including strong support fromexport credit agencies, the emergence of some regional financialplayers in the market, better capital markets activity in the pastfew months, and the ability of Boeing and Airbus to providecustomer financing. Fitch estimates that ECAs could supportapproximately 25% of LCA deliveries in 2009, illustrating thebenefit the industry has received from indirect governmentsupport. It looks like Boeing and Airbus will finance less than$2 billion of new aircraft in 2009, leaving the companies with thecapacity to help customers in 2010 if needed. New aircraft serveas attractive lending collateral due to the mobility of theassets, operating efficiency compared to previous aircraftgenerations, and unique treatment in bankruptcy in somejurisdictions.

The comments above apply to new aircraft financing, notrefinancings of existing debt. Fitch estimates that there will be$14 billion of maturing airline debt in the U.S. alone in 2010-2011.

Economic Assumptions:

Underpinning Fitch's A&D outlook is the firm's most recent globaleconomic outlook, which as of October 2009 calls for global GDP toshrink 2.8% in 2009, followed by global growth recovery to 2% in2010 and 2.7% in 2011. GDP should rise, but from a low base, andexpansion will be weak relative to previous recoveries. There issome uncertainty in 2011 due to likely tightening of monetary andfiscal stimulus. Fitch expects GDP to grow 6.5% in the BRICcountries (Brazil, Russia, India, China) in 2010. Although globalGDP looks set to return to positive growth, the absolute level ofGDP is low and, in the U.S., it is possible that GDP may notreturn to the 2008 level until 2011.

Fitch's specific A&D assumptions include no recovery in 2010 otherthan early cycle parts such as aftermarket. Late cycle segmentssuch as original equipment will continue to be weak, showing somevolume declines, although nowhere near as dramatic as in 2009 orin the last downturn that began in 2001.

A more detailed report on the global 2010 aerospace & defenseindustry outlook will be available on the Fitch Ratings Web siteat 'www.fitchratings.com' in January.

Fitch-rated issuers and their current Issuer Default Ratings inthe North American aerospace/defense sector:

-- Alliant Techsystems Inc. (ATK) ('BB'; Outlook Stable);

-- Boeing Company (BA) ('A+'; Outlook Negative);

-- Bombardier Inc. (BBD/B) ('BB+'; Outlook Negative);

-- General Dynamics Corporation (GD) ('A'; Outlook Stable);

-- Goodrich Corporation (GR) ('BBB+'; Outlook Stable);

-- Honeywell International Inc. (HON) ('A'; Outlook Negative);

-- ITT Corporation (ITT) ('A-'; Outlook Stable)

-- L-3 Communications Corporation (LLL) ('BBB-'; Outlook Stable);

-- Lockheed Martin Corporation (LMT) ('A-'; Outlook Stable);

-- Northrop Grumman Corporation (NOC) ('BBB+'; Outlook Stable);

-- Raytheon Company (RTN) ('A-'; Outlook Stable);

-- Rockwell Collins, Inc. (COL) ('A'; Outlook Stable);

-- Textron Inc. (TXT) ('BB+'; Outlook Negative);

-- Transdigm Group (TDG) ('B'; Outlook Stable);

-- United Technologies Corporation (UTC) ('A+'; Outlook Stable).

* Fitch Says Rating Trends Stable for Diversified Industrials----------------------------------------------------------------According to Fitch Ratings, the number of negative rating actionsfor the U.S. Diversified Industrials sector is likely to be muchlower in 2010 than in 2009 as rating trends are expected tostabilize. A return to economic growth across many regions, thegradual completion of restructuring and downsizing programs, focusby issuers on stronger balance sheets, and a more stable operatingenvironment compared to the early phase of the global recessionwill all contribute to more stability next year. The pace ofratings downgrades in the broader U.S. corporate bond marketslowed materially in the third quarter of 2009, which would beconsistent with expectations for a slowly improving global economyand better performance by most companies in the diversifiedindustrial sector.

'Currently, Negative Rating Outlooks among diversified companiesrated by Fitch significantly outnumber Positive Outlooks, but asissuers repair their credit profiles, Negative Outlooks could berevised to Stable and upgrades could increase,' said Eric Ause,Senior Director at Fitch. 'Positive rating actions would beexpected to occur late in the credit cycle, possibly after 2010 asa return to stronger credit metrics may be slower than usual,which reflects the severity of the recent recession, simultaneousstresses in the credit markets that have pressured liquidity, andthe potentially anemic pace of an economic rebound.'

Issuers Expected to Rebuild Balance Sheets in 2010:

Entering 2010, leverage is at relatively high levels for manydiversified companies. Higher-than-normal leverage is not unusualat this stage of the credit cycle and is due largely to loweroperating results. When operating results eventually improve,leverage can also be expected to improve. However, the recoveryis anticipated to be slow which could hinder a return to lowerleverage. This concern is partly mitigated by a trend towardsmanaging balance sheets more conservatively in response todifficult capital markets and the evident value of liquidity.Several diversified companies issued meaningful amounts of equityin the first nine months of 2009 (GE, JCI, KMT, TXT), notincluding ETN which issued equity in 2008, and two issuers (GE,TXT) cut their dividends. Acquisition activity has been quiet butcould increase in 2010, reflecting recent increases in valuations.

Rebound in Operating Performance Expected to be Slow:

Sales in 2010 for U.S. diversified companies are expected toimprove slowly from trough levels reported during 2009, but therecovery from the recent recession could be fitful. Fitchanticipates that a full recovery will not occur until late-cyclesectors of the economy begin to revive, possibly as late as 2011.Underpinning Fitch's Diversified outlook is the firm's most recentglobal economic outlook, which as of October 2009 calls for globalGDP to shrink 2.8% in 2009, the first time annual growth has beennegative since WWII, followed by expected global growth recoveryto 2% in 2010 and 2.7% in 2011. In the major advanced economies(MAEs) where diversified companies still conduct the bulk of theirbusiness, GDP is forecast to decline 3.7% in 2009 and return to atepid growth rate of 1.2% in 2010. Fitch expects GDP to grow 6.5%in the BRIC countries (Brazil, Russia, India, China) in 2010.Although global GDP looks set to return to positive growth, theabsolute level of GDP is low, and it is possible that in the U.S.GDP may not return to the 2008 level until 2011.

Mixed Revenue Outlook:

Diversified companies typically are composed of a mix of early-,mid- and late-cycle businesses. They also sell into diversegeographic end-markets. As a result, the pace at which salesrecover will vary by issuer depending on each issuer's customerbase. On a sequential basis, demand generally stopped falling bythe third quarter of 2009. In many late-cycle markets, ordershave stopped falling, although actual sales could decline foranother quarter or two. Most issuers remain cautious aboutpredicting the strength and timing of a rebound in sales. Normaleconomic signals are obscured by several factors: 1) inventorydestocking earlier in 2009, followed by re-stocking which wouldrepresent a non-recurring boost to sales, 2) the U.S. cash-for-clunkers program that accelerated the replacement of oldervehicles in the automotive sector, and 3) stimulus spending inChina and cash-for-clunkers programs in Europe.

Late-cycle businesses such as non-residential construction willremain weak well into 2010, offsetting improvements in early cyclebusinesses. In the aerospace sector, Fitch expects largecommercial aircraft deliveries by Boeing and Airbus to declineapproximately 5% (excluding potential 787 deliveries) from 2009,but there is a risk of additional production cuts, especially in2011. However, high backlogs at Boeing and Airbus should bufferthe expected decline. The aerospace aftermarket could show someimprovement in late 2010 after declining sharply in 2009 due to areduction in the number of flights and the cannibalization ofparked planes by the airlines. Business jet deliveries appearlikely to decline further in 2010 following a very weak year in2009. Fitch expects business jet deliveries for all of 2009 tofall 35-40% from a cyclical peak in 2008, and a peak to troughdecline of 50% would not be unrealistic. Diversified companieswith material exposure to aerospace include GE, ETN, HON, TXT andUTX.

Non-residential construction is expected to fall 12% in 2010following a 16% decline in 2009 according to the AmericanInstitute of Architects' most recent Consensus ConstructionForecast. It is possible that conditions could be weak wellbeyond 2010, depending on trends in vacancy rates and theavailability of financing. Most diversified companies have someexposure to non-residential construction through electricalproducts (CBE, HUBB, ETN, TNB), controls and systems (HON, JCI),elevators (UTX), scaffolding (HSC) and a wide variety of otherproducts and services. Some non-residential markets will benefitfrom expected spending related to stimulus and energy conservationprojects, particularly institutional buildings for which theoutlook is not as negative as it is for office, retail andindustrial buildings.

The U.S. market is expected to fare worse than other regionsaround the globe. Europe is also weak. Developing markets havelargely performed better than developed markets and should returnto normal growth more quickly. As the U.S. represents a largeshare of total non-residential construction, a protracted downturnin non-residential construction will temper the impact ofimproving results in other parts of the economy. Residentialconstruction also is a significant market for diversifiedcompanies. The sector has shrunk so much over the past few yearsthat there is not much downside risk. On the other hand, it isnot clear how quickly the sector will recover given the largeinventory of homes, a lack of liquidity affecting privatefinancing, and declining valuations that leave many homeownerswith negative equity.

The outlook is more positive for shorter-cycle, consumptionoriented businesses (services and parts) that should benefit froma resumption of stable economic activity. However, absolute saleslevels are currently low and growth seems likely to be tepid asthere are few end-markets where strong demand is expected. Salesgrowth could vary across sectors depending on their location inthe capital investment chain. Sales of longer-lived parts andequipment may only recover gradually as existing productioncapacity and equipment is brought to full capacity or used up.Exceptions include certain energy and infrastructure markets.These markets are less directly tied to economic cycles than tolong-term demand for energy and to demographic trends that affectpublic funding for water and transportation projects.

Margins to Benefit from Cost Controls and Stabilizing Sales:

During 2010 diversified companies can be expected to rebuildmargins as they complete restructuring efforts and align costswith lower sales levels. Margin performance has varied widely in2009. Some companies (UTX, TNB, FLS) reacted early or were ableto take advantage of a variable cost structure to limit margindeclines. In other cases, orders and sales dropped sharply,particularly in short-cycle businesses, contributing to temporaryquarterly losses (KMT, ETN, JCI). Profitability typically wasrestored by the third quarter of 2009 when sales stopped fallingat the rapid pace that occurred in the first half of the year.Although conditions should be more stable in 2010 than during2009, demand remains weak and diversified companies will bechallenged to balance the risk of excess capacity with thepossible loss of market share when demand eventually improves. Inlate-cycle businesses, margins could remain under pressure wellinto 2010 until the recession runs its course. This concern ismitigated by a long order cycle, relative to short-cyclebusinesses, that helps smooth out production and reduce salesvolatility. Cancellations by customers remain a risk, however, asdoes the availability of financing that often is an importantfactor in long-cycle projects. Government stimulus spending maylimit these risks depending on where and when it is used.

Other items could also affect margins in 2010. Raw material costshave fallen dramatically since peaking in 2008. However, somecosts, such as oil and copper, have subsequently rebounded,highlighting volatility as an ongoing risk. In the near term, aweak economy can be expected to keep raw material costs atmoderate levels. Pricing represents another risk. To date therehas been limited pricing pressure, but it could increase as oldcontracts run off and as diversified companies and their customerscontinue to adjust to a period of low demand. Finally, pensionexpense could increase depending on market conditions. Any cashimpact on pension contributions would appear to become moresignificant after 2010.

Restructuring to Wind Down Gradually:

As restructuring is gradually completed, margins in 2010 will besupported by lower costs and the absence of restructuring charges.Any increases in volume would also support margins through betterabsorption. Margins in 2010 may not increase to levels seen priorto the recession, but they should improve on a sequential basiscompared to cyclical lows, many of which occurred in the secondquarter of 2009. Steep sales declines in the first half of 2009depressed operating margins, sometimes causing losses in certainbusinesses as capacity couldn't be reduced quickly enough tooffset lower volumes.

Temporary cost reductions were initiated by a large number ofdiversified companies during 2009 to protect profits and preserveliquidity. Their eventual reversal could partly negate thepositive impact of restructuring. Some temporary cost reductionshave already been reversed, but others remain in place and may notbe reversed until economic conditions improve further. Temporarycuts included furloughs and reductions to compensation such asbonuses and 401(k) plans.

Free Cash Flow Could Decline Modestly:

Fitch anticipates that cash from operating activities in the nearterm may be only slightly lower than historical levels, relativeto income. As explained above, aggressive restructuring hasenabled many diversified companies to limit margin declines tomodest levels. Working capital reductions have supported cashflow during 2009 as sales have fallen. Sales growth in 2010 couldreverse this trend and require cash to be invested in workingcapital, but amounts likely would not be large given expectationsfor slow economic growth.

Pension liabilities continue to be a concern. Although assetreturns in 2009 have been favorable, interest rates remain low andmay negate a portion of asset returns when net pension liabilitiesare calculated at the end of 2009. In many cases, requiredpension contributions in 2010 may remain low, but they couldincrease in subsequent years unless further strong asset returnsand/or an increase in the discount rate help to reduce net pensionliabilities.

Fitch does not expect capital expenditures to increasesubstantially in 2010 compared to reduced levels in 2009. Theprimary driver is the lack of investment opportunities related toslow growth, although some issuers in 2009 reduced capitalspending in an effort to preserve liquidity in the face ofdifficult conditions in the debt markets. As with workingcapital, any benefit to free cash flow would likely be reversedonce sales improve and companies look to take advantage ofinternal growth opportunities.

Uncertain Impact of Discretionary Expenditures:

Acquisitions may become more common in 2010 as visibility intoend-market demand improves further. Most diversified companiescontinue to maintain a list of potential acquisitions and couldact quickly. Acquisition activity was relatively low in 2009 dueto a focus by some issuers on preserving liquidity, the relatedissue of limited availability or high cost of financing, theunwillingness of sellers to accept low prices, and a priority onrestructuring existing operations.

Share repurchases could increase in 2010 but are not likely, inFitch's view, to be nearly as substantial as in previous years.Issuers are focused on maintaining a strong balance sheet tooffset the impact of weaker earnings, a lack of confidence in theavailability of financing, and uncertainty about the economy.Even UTX and SPW, which are among the more consistent companieswith respect to discretionary cash deployment, have scaled backshare repurchases until conditions improve.

Liquidity and Financing Expected to be Manageable:

Disruptions in the capital markets during the past two years havefaded but could have a long tail. Government support played amajor role in stabilizing the capital markets and it continues tobe important. Despite investor confidence that contributed tostrong market returns during 2009, it is unclear to what degreethe capital markets still depend on government support or howquickly government support will be phased out. Diversifiedcompanies sell into end-markets where financing may be needed tofund projects or large equipment. If the availability offinancing continues to be problematic for customers of diversifiedcompanies, future sales could be negatively affected.

Among the diversified companies rated by Fitch, financingcontinues to be available and liquidity concerns have beenaddressed successfully. The only exception was TXT's drawdown ofits bank facilities in February 2009 as a defensive action toprotect its liquidity while it proceeds with the wind-down of non-captive financing at Textron Financial. Even so, TXT wassubsequently able to issue debt and equity. Although issuers areable to access the capital markets, there are concerns aboutmarket reliability.

Issuers are likely to be less sensitive to conditions in thecommercial paper market in 2010 than during the past one to two,largely because they have taken a more cautious approach tomanaging their balance sheets in response to the previous capitalmarket disruptions. A number of issuers paid down commercialpaper balances with proceeds from long-term debt or equity, whileothers paid down commercial paper as a way to reduce total debtand control leverage. Due to continuing uncertainty surroundingthe capital markets, issuers could continue to look foropportunities to issue debt in 2010 while interest rates arefavorable.

Bank financing has become more restrictive, most notably whenissuers look to renew revolving credit facilities that typicallyrepresent an important source of liquidity. Previous marketlosses and growing delinquencies that normally accompanyrecessions have pressured bank to improve their capitalization andreduce their risk exposure. As a result, banks are offering lessfavorable terms. In most cases, revolving credits are beingrenewed at lower amounts, shorter terms and higher pricing. Ifsuch terms don't eventually return toward previous levels, issuersmay consider increasing their reliance on long-term debt and othersources of financing.

Strategic Implications:

The impact of the recession on credit metrics for certain issuers(ETN, JCI, TXT) has been exacerbated by a variety of factors suchas acquisitions, end-market exposure, or strategic actions.Depending on the path of the economic recovery, more time thanusual may be needed to return credit metrics to normal levels atthese and other issuers similarly affected. Debt reduction can beexpected to be a priority. However, a long-term risk is thepossibility that it may be difficult to regain stronger creditmetrics while at the same time funding strategically importantactivities such as acquisitions. As a result, there potentiallycould be a trade-off, at least in the short run, betweenprofitability and competitiveness on one hand and, on the otherhand, a strong balance sheet and financial flexibility.

Issuers in the Diversified Industrial Sector:

Fitch-rated issuers and their current Issuer Default Ratings inthe U.S. diversified industrial sector:

* Lawmakers Revise Creditor Haircut For Failing Banks-----------------------------------------------------According to Law360, Reps. Brad Miller, D-N.C., and Dennis Moore,D-Kan., plan to offer an amendment to financial regulatory reformlegislation that would reduce the amount by which the FederalDeposit Insurance Corp. can limit the claims of secured creditorsof failed banks.

* SIPC Chief Struggles with Madoff Claims-----------------------------------------After decades largely spent shutting down no-name firms with a fewhundred customers, Stephen P. Harbeck, the president and CEO ofthe Securities Investors Protection Corp. has spent the last yearoverseeing the largest bankruptcy on record, the failure of LehmanBrothers and the Ponzi scheme run by Bernard L. Madoff, accordingto ABI.

* Scott Slaby Joins McDonald Hopkins as IP Associate----------------------------------------------------Scott M. Slaby has joined the Cleveland office of McDonald HopkinsLLC as an Associate in the firm's Intellectual Property Practice.

Slaby has six years of experience counseling clients on obtainingand protecting intellectual property rights. In particular, heassists clients in domestic and foreign patent preparation andprocurement in the chemical, biochemical, and mechanical arts.Slaby also prepares legal opinions regarding patentability,validity, and right to market. He has handled matters involving avariety of areas in the chemical and life-science arts. Slaby'sexperience includes trademark prosecution and counseling, as wellas IP Due Diligence, and assisting in patent, trademark,copyright, and trade secret litigation, licensing, and agreementmatters.

Slaby received his J.D., summa cum laude, from Cleveland-MarshallCollege of Law in 2003. He received a Master of Science degreefrom John Carroll University in 1997 and a Bachelor of Sciencedegree from John Carroll University in 1995.

About McDonald Hopkins

With more than 130 attorneys in Chicago, Cleveland, Columbus,Detroit, and West Palm Beach, McDonald Hopkins is a businessadvisory and advocacy law firm focused on business law,litigation, business restructuring and bankruptcy, healthcare, andestate planning. The president of McDonald Hopkins is Carl J.Grassi.

* BOOK REVIEW: Unique Value - The Secret of All Great Business Strategies--------------------------------------------------------------Author: Andrea Dunham and Barry Marcus, with Mark Stevens andPatrick BarwisePublisher: BeardBooksSoftcover: 303 pp.List Price: $34.95 trade paper(reprint of 1993 book published by Macmillan).

"Never stop leveraging what you do uniquely well," the authorstell the reader. This is the aim of a corporation seeking toprofit from its unique value. Any good businessperson will knowhow to do this leveraging in his or her given businessenvironment. The challenge, however, is determining thecorporation's unique value; which is, in most cases, aninterrelated set of strengths. The book instructs the reader onthe process and method for determining unique value: how torecognize it; how to inculcate it into the corporate culture, andhow to keep it in focus and preserve it during changing businessconditions.

Using many charts and diagrams, Dunham and Marcus illustrate theirtrademarked Unique Value = ROI Model. ROI -- return on investment-- is a familiar business ratio. It is not ordinarily linked tosomething called "unique value." But the authors make acompelling argument that the two are related. In fact, a case canbe made that nearly every business achieves its ROI from itsunique value, even though ROI is the universally acceptedfinancial measure of a corporation's productivity. With Dunhamand Marcus offering this new perspective on ROI, one quicklyrealizes that unique value (and ROI) is a function of marketing,customer relations, strategic planning, and other less tangiblecorporate factors. Although the authors do not elaborate on therelationship between unique value and these factors, it is easy todraw the conclusion that ROI is as much a result of image ormarket presence as it is financial planning and management.

The Unique Value Model is best seen as a pyramid with the"informing concept" of the Unique Value strategy at its peak. Thepyramid has four bases: Consumer/Customer, Business Systems andSkills, Product/Technology, and Competition. These are the fourmajor interrelated factors of any business organization. Theauthors posit that each of these has to be "analyzed, structured,and fully understood" for the Unique Value = ROI Model to beinformative and effective. The Unique Value Model serves as aninherent guide, or touchstone, for managing a corporation.

Unique Value is ultimately concerned with decision-making andoperations. This is what Marcus and Dunham mean by their adviceto "never stop leveraging what you do uniquely well." The authorsdemonstrate how corporate managers can apply their knowledge ofUnique Value to shape employee activity and interactions withcustomers or clients, plan marketing campaigns, decide upon thecontent and style of advertising, follow closely what certaincompetitors are doing, look for particular acquisitions, and otherpractices upon which the success of corporation depends. Mid- andlower-level employees may not even know there is such a coreconcept as Unique Value; but they will be a part of its embodimentfrom the leadership of executives and managers.

IBM, Frito-Lay, Seagram's, Yamaha, and Holiday Inn are among theprominent businesses that are used as examples of how Unique Valuecan be applied to ROI. Aspects of the model are already widely,though, in many cases, only partially practiced by successfulcorporations. After reading this book, it's hard to imagine how acorporation can be successful without heeding the principles ofunique value. The challenges posed by today's businessenvironment are greater than ever. Competition is fierce, both athome and from abroad; consumer demands are fickle; and politicspervades everything from taxes to the environment. Corporationsthat can clearly articulate and unerringly implement their UniqueValue have an advantage over their competitors. As theoriginators of the Unique Value = ROI Model, Marcus and Dunham noone can do a better job on instructing corporate leaders on thismatter of vital interest to corporations.

Andrea Dunham and Barry Marcus were partners in founding themanagement and marketing consulting firm Dunham & Marcus. One ofthe major developers of the proprietary Unique Value = ROI Model,Marcus is now CEO of Unique Value International, a consulting firmin the areas of marketing and brand development.

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Monday's edition of the TCR delivers a list of indicative pricesfor bond issues that reportedly trade well below par. Prices areobtained by TCR editors from a variety of outside sources duringthe prior week we think are reliable. Those sources may not,however, be complete or accurate. The Monday Bond Pricing tableis compiled on the Friday prior to publication. Prices reportedare not intended to reflect actual trades. Prices for actualtrades are probably different. Our objective is to shareinformation, not make markets in publicly traded securities.Nothing in the TCR constitutes an offer or solicitation to buy orsell any security of any kind. It is likely that some entityaffiliated with a TCR editor holds some position in the issuers'public debt and equity securities about which we report.

Each Tuesday edition of the TCR contains a list of companies withinsolvent balance sheets whose shares trade higher than $3 pershare in public markets. At first glance, this list may look likethe definitive compilation of stocks that are ideal to sell short.Don't be fooled. Assets, for example, reported at historical costnet of depreciation may understate the true value of a firm'sassets. A company may establish reserves on its balance sheet forliabilities that may never materialize. The prices at whichequity securities trade in public market are determined by morethan a balance sheet solvency test.

A list of Meetings, Conferences and Seminars appears in eachWednesday's edition of the TCR. Submissions about insolvency-related conferences are encouraged. Send announcements toconferences@bankrupt.com/

On Thursdays, the TCR delivers a list of recently filedChapter 11 cases involving less than $1,000,000 in assets andliabilities delivered to nation's bankruptcy courts. The listincludes links to freely downloadable images of these small-dollarpetitions in Acrobat PDF format.

Each Friday's edition of the TCR includes a review about a book ofinterest to troubled company professionals. All titles areavailable at your local bookstore or through Amazon.com. Go tohttp://www.bankrupt.com/books/to order any title today.

Monthly Operating Reports are summarized in every Saturday editionof the TCR.

The Sunday TCR delivers securitization rating news from the weekthen-ending.

For copies of court documents filed in the District of Delaware,please contact Vito at Parcels, Inc., at 302-658-9911. Forbankruptcy documents filed in cases pending outside the Districtof Delaware, contact Ken Troubh at Nationwide Research &Consulting at 207/791-2852.

This material is copyrighted and any commercial use, resale orpublication in any form (including e-mail forwarding, electronicre-mailing and photocopying) is strictly prohibited without priorwritten permission of the publishers. Information containedherein is obtained from sources believed to be reliable, but isnot guaranteed.

The TCR subscription rate is $775 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the samefirm for the term of the initial subscription or balance thereofare $25 each. For subscription information, contact ChristopherBeard at 240/629-3300.